KUWAIT, Oct 28 (Reuters) - Kuwait's stock exchange plans to launch derivatives trading in the first half of 2014 using its new Nasdaq-backed trading system, a senior stock exchange official told Reuters.
Kuwait's bourse, one of the oldest in the Gulf region, launched the "X-stream" trading system in May last year at a cost of around 18.3 million Kuwaiti dinars ($65 million), part of its biggest technical overhaul in nearly two decades.
The main aims of the Nasdaq OMX Group Inc. system were to launch the trading of financial instruments and to clamp down on dubious market activity.
The exchange hopes to launch derivatives trading in the first six months of next year "if things proceed as expected," Stock Exchange Projects Manager Issam Alusaimi told Reuters in an interview.
"By the end of this year we will have finished everything related to I.T. infrastructure...the next step is to take advantage of the technology."
A Kuwaiti investment firm has already expressed interest in trading options, Alusaimi said, saying that the company's request had now been sent to the financial market watchdog. He declined to give the name of the firm.
The system will also be ready for trading futures, exchange-traded funds and Islamic bonds if similar requests are made, he said. Local and international investors will be able to use the system, he added.
The stock market suffered heavy losses during the global financial crisis but has seen a surge in activity since the start of this year, thanks to renewed optimism about government infrastructure plans that may benefit Kuwait companies.
Kuwait is home to some of the largest investment groups in the Gulf region such as Kuwait Projects Co (KIPCO) and Global Investment House.