Kuwait stocks drop to lowest since 2004

Kuwaiti shares tumbled, sending the benchmark index to the lowest level since 2004, amid investor concern the European and US debt crises may impact the country\'s international investments. Kuwait Finance House, the nation\'s largest investment bank, slumped the most since December 2009 after reporting a 43 per cent plunge in second-quarter profit. National Bank of Kuwait (NBK), the country\'s biggest lender, fell 5.3 per cent. The benchmark SE Price Index declined 1.6 per cent to 5,973.1, the lowest since September 2004, at the 12:30pm close in Kuwait City. The measure has lost 14 per cent this year. \"The Kuwaiti government has a lot of investments in the US and needs a quick solution to avoid another 2008 crisis,\" Khalid Bonashi, manager of retail sales brokerage at NBK Capital in Kuwait, said in a telephone interview. Article continues below \"Nevertheless, the region, and Kuwait in particular, is in a better and more comfortable position than others.\" Kuwait, through its sovereign wealth fund has stakes in companies including Citigroup, Bank of America Corp\'s unit Merril Lynch & Co, BP and Daimler. Concerns that Europe\'s debt crisis is spreading to Italy and Spain, as well as wrangling between US President Barack Obama and Republican lawmakers over raising the country\'s debt ceiling has roiled global markets. Global shares Stocks fell around the world on Monday, led by banks, while the euro weakened to a record against the Swiss franc as stress tests failed to allay concern the debt crisis will deepen. The MSCI All-Country World Index slid 0.6 per cent in Dubai and the MSCI Emerging Markets Index lost 0.8 per cent. In Kuwait, a capital markets law that places restrictions on investment funds is also weighing down on shares, Bonashi said. The law stipulates that investment funds may not own more than 10 per cent of a publicly traded company, or investment more than 10 per cent of the fund in one company. Kuwait Finance House tumbled 5.2 per cent to 910 fils. National Bank of Kuwait slumped to 1,080 fils. Abu Dhabi\'s shares fell the most since March as etisalat posted profit that missed analysts\' estimates. UAE benchmarks The ADX General Index retreated 0.9 per cent, the most since March 31, to 2,707.23. Dubai\'s gauge lost 0.8 per cent. Etisalat fell 1.4 per cent to Dh10.90. Second-quarter net income dropped 15 per cent to Dh1.59 billion. The median estimate of three analysts was for a profit of Dh1.86 billion, according to data compiled by Bloomberg. \"Investors are taking their cue from etisalat numbers,\" said Ebrahim Masoud, who helps manage about $400 million (Dh1.4 billion) at Mashreqbank.