Boursa Kuwait Introduces MSCI Inclusion Measures

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Boursa Kuwait Introduces MSCI Inclusion Measures

In preparation for Kuwait’s inclusion in the MSCI Emerging Markets index, Boursa Kuwait is introducing a series of measures in collaboration with the Kuwait Clearing Company. Some of these measures will be temporary and apply on the late November inclusion date only, while some will become a permanent part of the trading mechanism going forward.

Starting today, Sunday, November 8, Boursa Kuwait and the Kuwait Clearing Company will be making permanent changes to the trading mechanism with the introduction of Allocation Consolidation Module (ACM) accounts.

An ACM account is a specialized mechanism for managers of large assets to aggregate orders while settlement happens on the individual’s mandated accounts at the end of the trading session.

During the inclusion session, there will be an extension of the Closing Auction and the Trade at Last (TAL) Session. The Closing Auction will go on for 40 minutes, followed by a 30-minute break before the TAL session kicks off for 40 minutes.

Buy and sell orders will also be matched at a randomized closing time for the last two minutes of the Closing Auction session. Additionally, order amendments and cancellations will be allowed throughout the Closing Auction session. There will also be an extension on Custodian Rejections during inclusion.

Boursa Kuwait’s Head of Markets Sector, Noura Al-Abdulkareem, commented on the measures, saying “In keeping with our ongoing commitment to developing the Kuwaiti capital market to meet international, best-in-class standards and practices, Boursa Kuwait has been working with the Capital Markets Authority, the Kuwait Clearing Company, and our partners locally and around the world to make sure the MSCI inclusion is a smooth and hassle-free process for all market participants. The extension of the Closing Auction and Trade at Last (TAL) session, are measures undertaken by the exchange after careful deliberation and consultation with the concerned parties and market participants. The new measures will further enhance the efficiency, appeal, and performance of the market to attract investments from local and international investors and is a testament to Boursa Kuwait’s commitment to bolster our reputation for providing issuers with efficient access to capital and investors with diverse return opportunities. I would also like to thank the Capital Markets Authority and the Kuwait Clearing Company for their continuous support, without which we would not have achieved these successes.”

Mr. Duaij Raed Al-Saleh, Acting Deputy CEO of the Information Technology Sector at the Kuwait Clearing Company, also commented on the inclusion measures, saying “The Kuwait Clearing Company has been working with Boursa Kuwait, the Capital Markets Authority, MSCI Inc. and our partners in the international investment community to insure the seamless undertaking of the inclusion. The introduction of ACM accounts is one of a series of measures that the KCC will be introducing in preparation for inclusion day, and we will continue working with our partners to improve the trading mechanism, whether for future inclusions or for the benefit of the Kuwaiti capital market, going forward.”

As a global recognition of the sweeping market development efforts by Boursa Kuwait, the Capital Markets Authority and the Kuwait Clearing Company, MSCI upgraded Kuwait to ‘Emerging Market’ status in December 2019. Following the country’s inclusion in S&P Dow Jones Indices’ Global Equity Indices, with an Emerging Market classification in December 2018 and the FTSE Russell Emerging Markets Index in September 2017.

Since its inception, Boursa Kuwait has worked effortlessly to create a credible exchange built on efficiency and transparency, creating a liquid capital market, a progressive exchange platform and developing a comprehensive set of reforms and enhancements that has allowed it to compete on an international level. The company has rolled out numerous market reforms and new initiatives over the past three years as part of its comprehensive multi-phase market development (MD) plans, and is currently working towards launching new products including margin trading, tradable rights issue, fixed income Bonds and Sukuk, as well as exchange-traded funds (ETFs).

For more information on Boursa Kuwait’s initiatives and latest updates, please visit www.boursakuwait.com.

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