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Weekly Market Report

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  • 1. Market Review and Outlook QE Index and Volume The Qatar Exchange (QE) Index gained 97.13 points, or 0.93%, during the week, to close at 10,486.23 points. Market capitalization increased by 0.99% to reach QR559.5 billion (bn) as compared to QR554.0bn at the end of the previous week. Of the 42 listed companies, 24 companies ended the week higher while 15 fell and 3 remained unchanged. Widam Food Company (WDAM) was the best performing stock with a gain of 9.25%; the stock is down 5.61% yearto-date (YTD). The stock was also actively traded with 1.2mn shares traded during the week. Vodafone Qatar (VFQS) was the worst performing stock with a decline of 3.21% on 22.3mn shares traded; the stock is up 37.37% YTD. 10,510 20,000,000 10,496.89 10,457.12 10,455 10,000,000 10,436.52 10,434.10 10,400 0 8-Dec 9-Dec 10-Dec Week ended Dec 05, 2013 1,585.0 559,458.1 553,978.1 1.0 55.7 13.4 25,891 22,628 14.4 42 42 0.0 24:15 22:18 8.7 Companies Traded Value Traded (QR mn) Exch. Market Cap. (QR mn) Volume (mn) Number of Transactions Market Breadth Market Indices Close Total Return 14,982.41 All Share Index 2,610.14 Banks/Financial Svcs. 2,485.82 Industrials 3,436.90 Transportation 1,933.51 Real Estate 2,026.25 Insurance 2,370.57 Telecoms 1,462.46 Consumer 5,983.87 Al Rayan Islamic Index 3,077.36 Market Indices Weekly Index Performance 7.5% Qatar (QE)* Dubai Abu Dhabi Saudi Arabia Kuwait Oman Bahrain Close 10,486.23 3,157.85 4,000.94 8,387.61 7,704.34 6,749.75 1,206.70 WTD% MTD% YTD% 0.9 4.8 1.6 1.7 (0.8) (0.3) 0.8 1.1 7.2 3.9 0.7 (1.0) 0.3 (0.2) 25.4 94.6 52.1 23.3 29.8 17.2 13.2 WTD% 0.9 1.0 1.1 1.7 0.1 1.4 0.5 0.1 0.1 0.3 Chg. % 27.2 MTD% 1.1 1.1 1.6 1.0 (0.5) 1.6 0.2 0.6 0.1 1.5 YTD% 32.4 29.6 27.5 30.8 44.3 25.7 20.7 37.3 28.1 23.7 4.8% 5.0% 1.7% 2.5% 1.6% 0.9% 0.8% 0.0% Weekly Exchange Traded Value ($ mn) 775.39 1,371.24 752.44 5983.25 431.34 125.28 9.63 Exchange Mkt. Cap. ($ mn) 153,683.1 72,132.0 113,758.4 448,533.9# 109,375.0 9336.5 49,714.0 Kuwait (0.3%) (0.8%) Oman Bahrain Qatar Abu Dhabi Saudi Arabia Dubai (2.5%) The GCC markets remained mixed during the week. Dubai‟s benchmark index was the top performer, surging by 4.8% WoW; it is up 94.6% YTD. On the other hand, Kuwait‟s index retreated by 0.8% WoW. Regional Indices QE Index 63.2 On the other hand, Masraf Al Rayan (MARK) after two weeks of significant contribution to the QE Index’s weekly gain dragged it by 11.0 points during the week. MARK is up 35.94% YTD and hit a 52-week high of QR34.30 during Sunday‟s (December 08, 2013) trading session. Vodafone Qatar (VFQS) shaved the index down by 5.4 points WoW. Foreign institutions remained bullish for the week with net buying of QR149.4mn vs. net buying of QR29.0mn in the prior week. Qatari institutions remained bearish with net selling of QR12.3mn vs. net selling of QR62.1mn the week before. Foreign retail investors remained bearish for the week with net selling of QR19.0mn vs. QR33.0mn in the prior week. Qatari retailer investors turned bearish with net selling of QR118.6mn vs. net buying of QR65.9mn the week before. 12-Dec Week ended Dec 12, 2013 2,016.7 Market Indicators Trading volume increased by 13.38% to reach 63.2mn shares vs. 55.7mn shares in the prior week. The number of transaction rose by 14.42% to reach 25,891 transactions versus 22,628 transactions in the prior week. The Telecoms sector led the trading volume, accounting for 35.5% of the total. 11-Dec Volume QNB Group (QNBK) was the biggest contributor to the QE Index’s weekly gain. The stock contributed 34.6 points to the index‟s weekly gain; QNBK is up 2.35% week-over-week (WoW) and 32.9% YTD. Industries Qatar (IQCD) was the second biggest contributor adding 26.0 points; the stock has gained 1.63% WoW. Trading value during the week increased by 27.24% to reach QR2.0bn vs. QR1.6bn in the prior week. The Banks and Financial Services led the trading value during the week, accounting for 33.0% of the total equity trading value. 10,486.23 TTM P/E** P/B** Dividend Yield 13.4 18.6 11.2 17.2 16.6 10.6 8.1 1.8 1.3 1.4 2.1 1.2 1.6 0.9 4.4 2.8 4.5 3.5 3.7 3.8 4.0 # Source: Bloomberg, country exchanges and Zawya (** Trailing Twelve Months; * Value traded ($ mn) do not include special trades, if any) ( Data as of December 11, 2013) Page 1 of 5
  • 2. News Economic News  Lasting Iran deal could lead to a Qatar rating upgrade – According to QNB Group, Qatar, which does not face any imminent threat from the US shale gas boom, could expect to get higher ratings if there is a permanent solution for Iran nuclear crisis. QNB‟s Head of Economics Joannes Mongardini said that Qatar‟s non-hydrocarbon sector is expected to grow faster than its oil segment and is expected to witness an additional inflow of 300,000 workers to fill in 240,000 new jobs over the next one to two years. (Gulf-Times.com)  QCB issues 3 and 5-year government bonds, sukuk – The Qatar Central Bank has issued QR4bn worth of government bonds and sukuk with three-year and five-year durations. (QCB press release)  Doha metro stations set for completion by 2018 – The construction work on major underground stations of the Doha Metro Project, which are progressing as scheduled, are expected to be accomplished by 2018. Saad Ahmed alMuhannadi, CEO of Qatar Rail Company said that work on the underground projects is moving along as scheduled and the Lusail Light Rail Transit (LRT) has reached an advanced stage. The Lusail LRT underground station is almost complete with regard to civil engineering works. Other architectural and technical works would be held in another stage in connection with other stations. (Gulf-Times.com)  MMUP embarks on several urban projects in 2013 – The Ministry of Municipality & Urban Planning (MMUP) has embarked on several projects in 2013 to improve its performance & services, boost Qatar‟s comprehensive construction plan and develop different municipalities in Qatar. MMUP has completed a feasibility study on a draft project of Bus Rapid Transit System. The ministry has prepared a draft strategy for housing workers and laying guidelines for the development of coastal areas. The ministry has also adopted a national heritage strategy and the preparation of master plans for the Doha Port in collaboration with the Public Works Authority (Ashghal). Moreover, the Ministry has contributed to the 2022 FIFA World Cup project by preparing master plans for stadiums areas and locating 92 exercise playgrounds in Qatar. The ministry has also provided support to the Qatar Olympic Committee by preparing the general plan for the Olympic Park in Lusail City. The total number of new projects for land distribution in coordination with the Department of Urban Planning has reached 5,942 in 2012-2013. (Bloomberg)  QCB: Construction sector surged by 9.3% in 2012 – According to the data released by the Qatar Central Bank (QCB), Qatar‟s construction sector rose by 9.3% in 2012 to emerge as one of the fastest growing non-oil sectors. The construction sector has gained nearly QR2.3bn in 2012 to climb to a record high in current prices. However, the report showed that the construction sector‟s share of GDP had edged down to 10.5% in 2012 from 11.2% in 2011. (Bloomberg) Market & Corporate News  QCB, QFCRA, QFMA jointly launch strategic plan for Qatar’s financial sector regulation – The Qatar Central Bank (QCB), the Qatar Financial Centre Regulatory Authority (QFCRA) and the Qatar Financial Markets Authority (QFMA) have jointly launched a strategic plan for the future of financial sector regulation in Qatar. The plan will establish a framework for regulating Qatar‟s financial sector by laying a roadmap of strategic priorities for the 2014-2016 period. This strategic plan is a comprehensive document that contains six mutually re- enforcing goals, each of which is supported by specific work plans among QCB, QFCRA and QFMA. These goals include: enhancing regulation by developing a consistent risk-based micro-prudential framework, expanding macro-prudential oversight, strengthening the financial market infrastructure, enhancing consumer & investor protection, promoting regulatory cooperation and building human capital. This strategic plan will position Qatar as a leader in the regional financial sector and will support Qatar‟s ambition to be a global financial center. (QCB)  QNB to offer benefits-packed salary account campaign – QNB has launched its new fully enhanced salary account campaign, which offers different packages along with multiple benefits and most competitive interest rates to customers. According to Heba al-Tamimi, QNB Group‟s Retail Banking General Manager, this campaign is innovatively designed to cater to each customer's specific needs. Customers can also benefit from the lowest interest rates in Qatar on personal loans of 3.45% along with vehicle loans at 1.99%. To ensure that this offer will benefit all customers, mortgage loans will also be part of the campaign. Customers will receive as much as QR10,000 in cash back in addition to the very low interest rate of 3.75% when they transfer their mortgage loans to us. (QNB Group Press Release, Gulf-Times.com)  QR1.8bn Helium 2 Plant starts up at Ras Laffan – Qatar has become the world‟s largest exporter and second-largest producer of helium with the start up of the QR1.8bn Helium 2 Plant at Ras Laffan with a design capacity of 1.3bn standard cubic feet a year. The plant, which is the world‟s largest helium refining facility, co-owned by Qatargas and RasGas, will be operated by the latter. (Gulf-Times.com)  QP signs MoU to construct butadiene extraction, elastomer complex – Qatar Petroleum (QP) has entered into a MoU with Zeon Corporation and Mitsui & Co. Ltd for the construction of its butadiene extraction and elastomer complex in Qatar‟s industrial city of Ras Laffan. This plant will produce rubber from chemicals made at the planned petrochemical complex. (Bloomberg)  Lusail City’s 80% of properties sold – Qatari Diar Real Estate Investment Company said that 80% of real estate in the new Lusail City has been sold. (Bloomberg)  KCBK’s BoD approves bank’s 2014 budget, business plans – Al Khalij Commercial Bank‟s (KCBK) board of directors has discussed the provisional budget for 2014 and approved a number of items related to bank‟s business plans and regular activities. These include approval for new policies and frameworks that aim to enhance governance within the organization. (QE)  Ooredoo Algeria plans to float 10-15% stake on Algiers Bourse in 2014 – Ooredoo Algeria‟s CEO Joseph Ged said the company is planning to float 10-15% of its stake on the Algiers Bourse in 2014. The company expects a net profit of $190mn on a turnover of $1bn in 2013. (Bloomberg)  QGRI to study converting QGHC into private shareholding – The Qatar General Insurance & Reinsurance Company‟s (QGRI) management has decided to carry out a study to convert the Qatar General Holding Company (QGHC) from a “one person company” to a “private shareholding company”. This move will separate its real estate and investment activities into a separate legal entity. (QE) Page 2 of 5
  • 3. Qatar Exchange Top 5 Gainers Top 5 Decliners 0.0% 12.0% 9.3% -1.5% -2.0% 8.0% -2.2% -2.1% -3.2% 4.3% 3.7% 4.0% -1.9% -4.0% 3.1% 2.4% 0.0% -6.0% Widam Food Qatar Cinema Co. & Film Distribution Aamal Qatar General Qatar National Insurance & Cement Reinsurance Source: Qatar Exchange (QE) Qatar German Mazaya Qatar Qatar Islamic Co. for Insurance Medical Devices Al Meera Consumer Goods Source: Qatar Exchange (QE) Most Active Shares by Value (QR Million) 300.0 Vodafone Qatar Most Active Shares by Volume (Million) 294.3 24.0 22.3 258.9 224.0 205.9 200.0 187.3 16.0 9.5 100.0 8.0 6.0 3.8 0.0 3.0 0.0 Barwa Real Estate Vodafone Qatar Industries Qatar Masraf Al Rayan Source: Qatar Exchange (QE) 19.59% 80% 24.74% Barwa Real Estate Masraf Al Rayan Mazaya Qatar United Development Net Traded Value by Nationality (QR Million) 130 12.18% 12.71% 60% Vodafone Qatar Source: Qatar Exchange (QE) Investor Trading Percentage to Total Value Traded 100% QNB Group 13.65% Non-Qatari 651 25.35% 40% 42.95% 521 (131) 48.83% 20% Qatari 1,496 1,365 0% Buy Sell Qatari Individuals Qatari Institutions Non-Qatari Individuals Non-Qatari Institutions Source: Qatar Exchange (QE) (400) (200) - 200 Net Investment 400 600 800 Total Sold 1,000 1,200 1,400 1,600 Total Bought Source: Qatar Exchange (QE) Page 3 of 5
  • 4. TECHNICAL ANALYSIS OF THE QE INDEX Source: Bloomberg The QE Index extended its upmove and ended last week on a positive note. The index breached the important resistance band of 10,400.0-10,450.0 and also tagged a 52-week high on Wednesday, but later reversed in the day. However, the Thursday‟s gains pushed the index closer to the 10,500.0 level. We believe until the time the index trades above the support band of 10,400.0-10,450.0, the bulls may continue to take charge and may push it higher toward the 10,550.0-10,600.0 levels. On the flip side, if the index retreats below the support band of 10,400.0-10,450.0, it may witness selling pressure and test the 10,350.0 level which is in proximity to the 21-day moving average. Any weakness below this level may drag the index further to test its strong support near the 10,300.0 level. Meanwhile, both the momentum indicators are providing mixed signals indicating signs of a volatile week ahead. Thus, traders are advised to exercise caution and keep a close watch on the support levels for any reversal signs. DEFINITIONS OF KEY TERMS USED IN TECHNICAL ANALYSIS RSI (Relative Strength Index) indicator – RSI is a momentum oscillator that measures the speed and change of price movements. The RSI oscillates between 0 to 100. The index is deemed to be overbought once the RSI approaches the 70 level, indicating that a correction is likely. On the other hand, if the RSI approaches 30, it is an indication that the index may be getting oversold and therefore likely to bounce back. MACD (Moving Average Convergence Divergence) indicator – The indicator consists of the MACD line and a signal line. The divergence or the convergence of the MACD line with the signal line indicates the strength in the momentum during the uptrend or downtrend, as the case may be. When the MACD crosses the signal line from below and trades above it, it gives a positive indication. The reverse is the situation for a bearish trend. Candlestick chart – A candlestick chart is a price chart that displays the high, low, open, and close for a security. The „body‟ of the chart is portion between the open and close price, while the high and low intraday movements form the „shadow‟. The candlestick may represent any time frame. We use a one-day candlestick chart (every candlestick represents one trading day) in our analysis. Doji candlestick pattern – A Doji candlestick is formed when a security's open and close are practically equal. The pattern indicates indecisiveness, and based on preceding price actions and future confirmation, may indicate a bullish or bearish trend reversal. Shooting Star/Inverted Hammer candlestick patterns – These candlestick patterns have a small real body (open price and close price are near to each other), and a long upper shadow (large intraday movement on the upside). The Shooting Star is a bearish reversal pattern that forms after a rally. The Inverted Hammer looks exactly like a Shooting Star, but forms after a downtrend. Inverted Hammers represent a potential bullish trend reversal. Page 4 of 5
  • 5. Price % Change 5(Dec 12) Day % Change Monthly Market Cap. QR Million TTM P/E P/B Div. Yield 174.00 2.35 1.16 121,753 13.2 2.4 3.4 Qatar Islamic Bank 70.10 0.14 0.43 16,564 15.3 1.4 5.3 Commercial Bank of Qatar 70.70 2.17 2.76 17,494 10.0 1.3 8.5 Doha Bank 57.00 0.88 2.15 14,727 10.0 1.6 7.3 Al Ahli Bank 56.00 (1.23) 6.67 7,116 13.7 2.1 5.4 Qatar International Islamic Bank 61.20 0.82 1.83 9,264 12.9 1.8 5.7 Masraf Al Rayan 33.70 (1.03) 2.12 25,275 15.1 2.5 3.0 Al Khaliji Bank 19.90 0.76 (0.50) 7,164 13.5 1.3 5.0 National Leasing 31.20 (0.32) (0.32) 1,544 13.2 1.2 6.4 Dlala Holding 22.30 1.73 3.00 495 N/M 2.2 N/A Qatar & Oman Investment 12.75 (0.62) (0.08) 402 26.7 1.2 3.9 Islamic Holding Group 41.15 0.00 3.91 165 22.1 2.9 2.7 Company Name Qatar National Bank 221,963 Banking and Financial Services Zad Holding 68.20 0.44 2.10 892 9.1 0.7 5.9 Qatar German Co. for Medical Devices 14.55 (2.15) (0.82) 168 N/M 0.9 N/A Salam International Investment 12.38 0.73 (0.64) 1,415 11.0 0.8 5.7 Medicare Group 53.10 (0.56) (0.75) 1,494 24.3 1.9 3.4 Qatar Cinema & Film Distribution 43.80 4.29 (1.02) 250 33.5 1.8 4.6 (0.31) (0.52) 18,581 15.5 3.1 3.5 999 16.6 4.1 7.2 2,680 18.4 2.1 6.0 286.00 Qatar Fuel 55.50 Qatar Meat and Livestock 134.00 Al Meera Consumer Goods 9.25 (1.47) 13.73 (0.74) 26,480 Consumer Goods and Services 50.70 0.20 (0.20) 2,008 9.5 1.5 5.9 Qatar National Cement 107.50 2.38 4.37 5,278 12.4 2.1 5.6 Industries Qatar 168.80 1.63 0.36 102,124 12.6 3.2 4.6 (1.22) 2.14 5,035 21.6 2.4 1.9 169.00 1.75 0.12 16,900 11.2 3.0 4.3 Mannai Corp. 87.30 0.23 (0.68) 3,983 8.7 1.7 5.4 Aamal 15.55 3.67 3.53 9,330 14.8 1.4 N/A Gulf International Services 59.40 1.19 1.37 8,831 14.6 3.1 2.5 Qatar Industrial Manufacturing 40.50 Qatari Investors Group Qatar Electricity and Water 153,489 Industrials Qatar Insurance 67.00 0.00 0.75 8,605 10.5 1.8 3.0 Doha Insurance 25.25 0.20 (0.98) 650 11.5 1.3 3.6 Qatar General Insurance & Reinsurance 49.50 3.13 (1.00) 2,853 3.3 0.8 1.8 Al Khaleej Takaful Insurance 39.00 0.00 0.00 666 13.9 1.1 2.1 Qatar Islamic Insurance 57.80 (1.87) 0.00 867 13.6 3.1 6.0 13,641 Insurance United Development 23.50 0.77 0.51 7,925 9.7 0.7 4.3 Barwa Real Estate 30.90 2.15 2.49 12,024 17.6 0.9 4.9 Ezdan Real Estate 17.20 (0.92) (1.32) 45,623 N/M 1.6 0.8 Mazaya Qatar Real Estate Development 11.52 (2.12) (0.69) 1,152 17.4 1.1 5.2 66,724 Real Estate 136.50 0.74 0.07 43,724 16.6 1.8 3.7 11.47 (3.21) 3.33 9,697 N/M 1.6 N/A Qatar Navigation (Milaha) 86.00 (1.15) (3.91) 9,849 10.1 0.8 4.4 Gulf Warehousing 40.70 (0.61) (0.73) 1,936 19.4 2.5 N/A Qatar Gas Transport (Nakilat) Transportation 21.35 1.18 2.40 11,956 15.6 3.4 4.7 Qatar Telecom Vodafone Qatar 53,421 Telecoms 23,741 Qatar Exchange 559,458 Source: Bloomberg Contacts Saugata Sarkar Ahmed M. Shehada Keith Whitney Sahbi Kasraoui Head of Research Head of Trading Head of Sales Manager - HNWI Tel: (+974) 4476 6534 Tel: (+974) 4476 6535 Tel: (+974) 4476 6533 Tel: (+974) 4476 6544 saugata.sarkar@qnbfs.com.qa ahmed.shehada@qnbfs.com.qa keith.whitney@qnbfs.com.qa sahbi.alkasraoui@qnbfs.com.qa QNB Financial Services SPC Contact Center: (+974) 4476 6666 PO Box 24025, Doha, Qatar DISCLAIMER: This publication has been prepared by QNB Financial Services SPC (“QNBFS”) a wholly-owned subsidiary of Qatar National Bank (“QNB”). QNBFS is regulated by the Qatar Financial Markets Authority and the Qatar Exchange; QNB is regulated by the Qatar Central Bank. This publication expresses the views and opinions of QNBFS at a given time only. It is not an offer, promotion or recommendation to buy or sell securities or other investments, nor is it intended to constitute legal, tax, accounting, or financial advice. We therefore strongly advise potential investors to seek independent professional advice before making any investment decision. Although the information in this report has been obtained from sources that QNBFS believes to be reliable, we have not independently verified such information and it may not be accurate or complete. While this publication has been prepared with the utmost degree of care by our analysts, QNBFS does not make any representations warranties as to the accuracy and completeness of the information it may contain, and declines any liability in that respect. QNBFS reserves the right to amend the views and opinions expressed in this publication at any time. It may also express viewpoints or make investment decisions that differ significantly from, or even contradict, the views and opinions included in this report. COPYRIGHT: No part of this document may be reproduced without the explicit written permission of QNBFS. Page 5 of 5

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