Markaz: Kuwait Equities Decline in August due to Profit Booking

(MENAFN- TRACCS) Kuwait, 03 September 2025: Kuwait Financial Centre “Markaz” released its Monthly Market Review report for August 2025. The report highlights that the Kuwait equity market declined in August 2025, following three consecutive months of gains due to profit booking. However, it continues to be the second-best performing equity market in GCC on YTD basis, clocking a return of 15.4%, after Dubai’s 17.5%.
Kuwait’s All Share Index declined by 1.4% during the month, weighed down by Premier market companies. Among the sectors, basic materials and utilities were the top gainers, rising 5.6% and 7.7% respectively. The banking sector index declined by 3.0% for the month, with Kuwait International Bank and Kuwait Finance House falling by 4.7% and 4.6% respectively. Commercial Bank of Kuwait was the top gainer among banks, rising 4.9% during the month. The bank has announced cash dividends of 12 fils per share to be distributed to shareholders as of 2nd September 2025. Among Premier Market stocks, Arzan Financial Group for Financing and Investment and GFH Financial Group were the top gainers, rising 15.5% and 11.8% respectively during the month. Arzan Financial Group’s subsidiary acquired 67.39% stake in National Medical Consumable Industries Co. to the tune of KD 8.09 million and the company expects the acquisition to increase its operating income from Q3 2025. GFH Financial Group has reported 11% y/y increase in its net profit for H1 2025, supported by rise in income from both investment banking and commercial banking activities. Kuwait has raised KD 150 million (USD 491 million) through domestic debt issuance during August, which was oversubscribed by about 10 times amid strong interest from local banks.
The S&P GCC Composite index lost 2.1% in August 2025, weighed down by lower oil prices and subdued corporate earnings. Except Oman, all GCC markets ended the month in red. Saudi Arabia equity index declined by 2.0% during the month, amid mixed corporate earnings. Among Saudi blue chips, Saudi National Bank declined by 6.7% during the month. The bank’s funding cost increased by 16 bps in Q2 2025 compared to Q1 2025 and it has lowered its guidance on net interest margin for 2025 to low-mid single digit from mid-high single digit. Saudi Aramco declined by 2.1% during the month as it reported a 22% y/y drop in net profit for Q2 2025 amid lower oil prices. Abu Dhabi’s equity index fell by 2.7% in August 2025, amid broad-based declines. First Abu Dhabi Bank (UAE) declined by 7.8% while Emirates Telecommunications Group Company (UAE) declined by 4.5% during the month. Dubai’s equity index closed 1.6% lower for the month. Emaar Properties (UAE) declined by 5.6% for the month. While the company’s net profit for Q2 2025 had risen by 39.7% y/y, it had declined by 9% compared to Q1 2025. Qatar’s equity markets declined by 0.3% for the month, amid a 3.5% decline in natural gas prices.
The IMF, in its Article IV consultation for the country, raised Saudi Arabia’s economic growth forecast to 3.6% y/y in 2025 from 3% in April and estimates the economy to grow by 3.9% y/y in 2026 due to recovery in oil production. Central Bank of the UAE estimates the country’s GDP would increase by 4.4% y/y in 2025 and by 5.4% y/y in 2026 underpinned by sustained economic diversification efforts and robust financial and banking systems.
Global markets were positive during August 2025, supported by expectation of rate cuts in September 2025. The MSCI World and S&P 500 indices rose by 2.5% and 1.9% respectively for the month. Lower than expected inflation and U.S Fed Chair’s comments on possibility of change in policy stance amid rising risks to employment during his speech at the Jackson Hole symposium raised market expectations about possible rate cuts by the U.S Fed in its upcoming policy meeting in September. U.S President’s new tariffs for about 90 countries took effect on August 07, 2025. Apple gained 11.8% in August 2025 as it announced fresh investments of USD 100 billion to strengthen its U.S manufacturing base, bringing its total investment commitment to USD 600 billion. MSCI EM index gained 1.2% during the month. Chinese equities rose by 8.0%, as U.S and China agreed to extend the pause in mutual levy of tariffs until November 2025 as they plan to hold further trade discussions.
U.S inflation stood at 2.7% y/y in July 2025, unchanged from June 2025, with the impact of newly imposed tariffs on many countries taking effect only from August 2025, its impact is yet to reflect in the inflation readings. The U.S labor market added 73,000 jobs in July, while data for May and June saw a steep downward revision to 19,000 and 14,000 respectively. This places June’s job growth as the lowest in nearly five years. U.S GDP growth in Q2 2025 was revised up to 3.3% y/y, up from earlier estimate of 3.0%, supported by investment of corporates in artificial intelligence.
The yield on the 10-year US treasury notes declined by 14 bps during the month to 4.23%. In his annual speech at the Jackson Hole symposium, the Fed Chair highlighted rising downside risk to employment, even as inflation pressure persist. He opined that, in this backdrop, current level of policy stance is restrictive and might warrant an adjustment. While he also added that a decision on this regard was yet to be made, market bets on potential rate cuts further pressured yields during the month.
Oil (Brent) prices closed the month at USD 68.1 per barrel, falling by 6.1% during the month. Continued unwinding of production cuts by OPEC+, China’s weak economic data, additional tariff levies by U.S on India for buying Russian oil pressured the commodity. However, slowdown in Russia-U.S. peace talks dimmed hopes over a peace deal for Ukraine, lending some support to oil prices. OPEC+ plans to raise oil production by 547,000 barrels per day for September 2025. This marks a complete reversal of voluntary production cuts by OPEC+ amounting to 2.2 million bpd, undertaken by eight members of the group including Saudi Arabia, UAE and Kuwait among others in January 2024.
The Fed’s September policy meeting and incoming data on labour markets and inflation are expected to guide movements in global and regional capital markets. GCC markets stand to benefit in the event of any rate cut decision by the Central Bank. Meanwhile, with the complete reversal of one tranche of production cuts, OPEC+’s next meeting in September 2025 would also be closely watched and the consequent impact on oil prices is also likely to influence GCC markets’ performance.

MENAFN03092025003982000056ID1110010866