Kuwait observes numerous public holidays, including major religious events such as Eid al-Fitr, Eid al-Adha, the Islamic New Year, the Prophet’s Birthday, and Isra and Mi’raj. Additionally, national holidays like National Day and Liberation Day, along with New Year’s Day, contribute to the country’s official break calendar.

While these holidays offer essential rest and cultural celebration for citizens and residents, they can pose significant challenges for Kuwait’s economy—particularly its financial markets.

The Kuwait Stock Exchange (KSE) is notably affected by extended holiday periods. Market closures during these times result in reduced liquidity, interruptions in trading activity, and diminished investor sentiment.

Many investors choose to delay significant investment decisions during long holiday breaks, leading to periods of market stagnation. Furthermore, when the stock exchange remains closed, it cannot respond swiftly to global economic or political events, potentially heightening market uncertainty upon reopening.

Small and medium-cap stocks are particularly susceptible to liquidity fluctuations during these closures. Moreover, prolonged or frequent holidays can discourage foreign investors from entering the Kuwaiti market, as they often seek more consistent trading opportunities.

Compared to other Gulf Cooperation Council (GCC) markets, Kuwait’s stock exchange faces greater disruption from public holidays. For instance, Saudi Arabia’s Tadawul, one of the region’s largest exchanges, is more resilient due to its size and diversified investor base. The Tadawul market structure allows it to absorb holiday-related impacts more effectively.

In contrast, Kuwait’s approach to its holiday calendar tends to be less flexible, resulting in more frequent and longer trading interruptions.

Authorities in Kuwait could consider revising the public holiday calendar to minimize stock market closures, especially during extended breaks. Another potential strategy is to exempt the Kuwait Stock Exchange from certain national holidays to maintain market continuity and attract more foreign capital.

Additionally, adopting best practices from global stock exchanges and providing investor education on managing portfolios around public holidays can improve overall market efficiency and reduce risk exposure.

Public holidays are integral to Kuwait’s cultural and social fabric. However, excessive and prolonged market closures can adversely affect stock market liquidity and erode investor confidence. By strategically reviewing and potentially revising holiday policies, Kuwait can enhance the performance and global competitiveness of its stock exchange.