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Wednesday, 6 May 2009

Regional bourses 'to remain low but attractive'

Gulf stock markets are expected to remain low relative to regional economies in the near future but the decline in their valuations has made them more attractive for investors, a key Kuwait bank said yesterday.

After large gains during the first half of 2008, the bourses in the GCC dipped by at least $500 billion till the end of April, sharply reducing their ratio to the gross domestic product in member states, the National Bank of Kuwait said in an eight-page report on GCC markets.

Instead of using the traditional price to earnings, price to book and other known ratios to assess share valuations in the GCC stock exchanges, NBK opted for market capitalisation to GDP (Mcap/GDP) ratio, which it said reflected the real market performance in the GCC over the past few years.

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