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Tue 5 Feb 2013 06:40 PM

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Kuwait at 8-month high; UAE markets extend gains

Investors bet on Gulf state's government spending plans being put into action

Kuwait at 8-month high; UAE markets extend gains

Kuwait's measure extends gains to close at a 8-month high as investors bet on government spending plans will be put into action, while UAE markets also end higher.

Kuwait's index climbs 0.5 percent to 6,338 points, its highest close since May 24.

Small-caps dominate trade, which is usually a sign that retail traders are looking for short-term gains.

Investors Holding and Abyaar Real Estate rise 12.2 and 6 percent respectively. Kuwait Business Town Real Estate climbs 8.5 percent and National Ranges adds 2.7 percent.

These four stocks account for half of all traded volumes, yet between them have a combined market value of less than $400 million.

"We suspected a bit of government activity yesterday on a few stocks but today the trading is mainly retail," says a Kuwait-based trader who asked not to be identified.

"The government doesn't seem to be holding back anything but we're looking for a proper spending plan to tackle the macro situation."

Under a four-year plan due to end in 2014, the government is supposed to spend 30 billion dinars ($107 billion) on industrial and infrastructure projects.

Despite extended delays, investors are hopeful that relative stability in the political situation will help kick-start these projects.

In the United Arab Emirates, Dubai's benchmark climbs 0.2 percent to finish at 1,869 points, extending 2013 gains to 15.2 percent.

Banks support. Dubai's Emirates NBD rises 1.1 percent and Dubai Islamic Bank adds 0.5 percent.

Abu Dhabi's index climbs 0.4 percent to 2,901 points, a fresh 34-month high, as the UAE capital's banks also rise.

Heavyweights First Gulf Bank and National Bank of Abu Dhabi add 1.2 and 0.9 respectively. Abu Dhabi Commercial Bank gains 2.8 percent.

Elsewhere, Qatar's benchmark climbs 0.3 percent to 8,748 points, a near four-week high.

United Development gains 4.4 percent, Industries Qatar rises 0.4 percent and Gulf International Services adds 1.8 percent.

In Oman, the index advances 0.4 percent to 5,837 points.