Weekly market report


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Weekly market report

  1. 1. Market Review and Outlook QE Index and Volume The Qatar Exchange (QE) Index gained 327.81 points, or 3.11%, during the trading week, to close at 10,873.08 points. Market capitalization increased by 2.26% to reach QR574.4 billion (bn) as compared to QR561.7 at the end of the previous week. Of the 42 listed companies, 31 companies ended the week higher while 9 fell and 2 remained unchanged. Islamic Holding (IHGS) was the best performing stock with a gain of 13.33% on 1.0 million (mn) shares traded. On the other hand, Qatar General Insurance & Reinsurance Company (QGRI) was the worst performing stock with a decline of 5.32% on 0.2mn shares traded. 10,900 Regional Indices Qatar (QE)* Dubai Abu Dhabi Saudi Arabia Kuwait Oman Bahrain Close 10,873.08 3,504.66 4,417.79 8,677.87 7,668.82 7,156.17 1,263.41 WTD% MTD% YTD% 3.1 0.9 1.3 0.7 1.6 3.9 1.2 4.8 4.0 3.0 1.7 1.6 4.7 1.2 4.8 4.0 3.0 1.7 1.6 4.7 1.2 10,550 0 5-Jan 6-Jan 7-Jan 8-Jan Volume 9-Jan QE Index Week ended Jan 09, 2014 2,897.0 Week ended Jan 02, 2014 1,150.6 574,369.8 561,701.3 2.3 61.9 30.5 103.1 31,167 16,912 84.3 42 42 0.0 Market Breadth 31:9 28:13 – Market Indices Close Total Return 15,535.13 All Share Index 2,689.32 Banks/Financial Svcs. 2,553.28 Industrials 3,613.44 Transportation 1,951.17 Real Estate 2,009.56 Insurance 2,432.27 Telecoms 1,521.09 Consumer 6,078.15 Al Rayan Islamic Index 3,181.33 Market Indices Weekly Index Performance WTD% 3.1 2.5 3.3 1.3 3.6 0.4 3.3 4.9 0.8 2.4 Market Indicators Value Traded (QR mn) Exch. Market Cap. (QR mn) Volume (mn) Number of Transactions Companies Traded 5.0% Chg. % 151.8 MTD% 4.8 3.9 4.5 3.2 5.0 2.9 4.1 4.6 2.2 4.8 YTD% 4.8 3.9 4.5 3.2 5.0 2.9 4.1 4.6 2.2 4.8 3.9% 1.6% 1.3% 1.2% 0.9% Bahrain 2.5% Dubai 3.1% 0.7% Weekly Exchange Traded Value ($ mn) 816.46 1,562.94 1,282.84 8,638.86 544.92 189.23 13.78 Saudi Arabia 0.0% Abu Dhabi Foreign institutions remained bullish for the week with net buying of QR519.7mn (including t-bills) vs. net buying of QR126.2mn in the prior week. Qatari institutions remained bearish with net selling of QR346.5mn vs. net selling of QR95.4mn the week before. Foreign retail investors remained bearish for the week with net selling of QR28.7mn vs. net selling of QR0.2mn in the prior week. Qatari retailer investors remained bearish with net selling of QR144.6mn vs. QR30.6mn the week before. 9,000,000 10,664.16 Kuwait Trading value during the week increased by 151.77% to reach QR2.9bn vs. QR1.2bn in the prior week. The Banks & Financial Services sector led the trading value during the week, accounting for 36.01% of the total equity trading value. Trading volume increased by 103.05% to reach 61.9mn shares vs. 30.5mn shares in the prior week. The number of transaction rose by 84.29% to reach 31,167 transactions versus 16,912 transactions in the prior week. The Banks & Financial Services sector also led the trading volume, accounting for 29.73% of the total. The significant increase in trading value, trading volume and number of transactions is due to the prior shortened trading week. 10,725 Qatar On the other hand, Qatar Electricity & Water Supply Company (QEWS) shaved 5.1 points off the index during the week. The stock has had a decent run in 2013 posting a total return of 44.8%. United Development Company (UDCD) after its bull run in 2013 corrected by 0.86% week-over-week (WoW) and dragged the index down by 2.8 points during the week. 10,798.69 10,784.49 Oman Ooredoo (ORDS) was the biggest contributor to the QE Index. The stock contributed 51.5 points to the index‟s weekly gain. ORDS posted a total return of 37.9% in 2013. Furthermore, ORDS was the biggest laggard in the prior week in the QE Index. Qatar Islamic Bank (QIBK) was the second biggest contributor adding 41.7 points to the index. QIBK has been a laggard in 2013 with a negative total return of 3.2%. 18,000,000 10,873.08 10,834.84 Exchange Mkt. Cap. ($ mn) TTM P/E** P/B** Dividend Yield 157,779.4 73,002.23 125,582.6 474,298.2# 109,877.3 25,499.2 50,536.5 13.9 20.7 12.3 17.7 17.0 11.3 8.2 1.9 1.4 1.5 2.2 1.2 1.7 0.9 4.2 2.5 4.1 3.4 3.7 3.6 3.8 # Source: Bloomberg, country exchanges and Zawya (** Trailing Twelve Months; * Value traded ($ mn) do not include special trades, if any) ( Data as of Jan. 08, 2014) Page 1 of 5
  2. 2. News Economic News  QNB Group: Qatar’s real GDP growth may pick up to 6.8% this year – QNB Group expects Qatar‟s real GDP growth to pick up to 6.8% in 2014 as the implementation of large infrastructure projects accelerates and the fast-growing population boosts domestic demand. QNB said that the acceleration will be due to large infrastructure projects such as the Lusail real estate development, the new Doha Port, the new Hamad International Airport and the Doha Metro Rail project. The non-hydrocarbon sector will continue to be the key growth driver, which is expected to grow from 42% of nominal GDP in 2012 to more than 50% by 2015. The Ministry of Development Planning & Statistics stated that Qatar‟s economic growth accelerated at a buoyant pace of 6.2% in 3Q2013 as compared to 3Q2012. QNB Group said that this growth was spurred by double-digit growth in trade, restaurants & hotels; construction; transport & communication; financial, real estate & business services; as well as domestic services. The hydrocarbon sector expanded to a better-than-expected 1.8% YoY in 3Q2013 due to LNG facilities coming back to full operational capacity after maintenance over last year. Meanwhile, the non-hydrocarbon sector grew 9.5% YoY 3Q2013, driven by a strong growth in services. (Gulf-Times.com) Market & Corporate News  QFC amends rules on insolvency, SFOs & SCs; to make firms more flexible – The Qatar Financial Centre (QFC) has issued amendments related to regulations on insolvency, single family offices (SFO) and special companies (SC) in an attempt to improve the QFC's legal architecture. These amendments aim to simplify procedures and give QFC firms more flexibility in their operations, improve legislative certainty and align QFC regulations with best practices elsewhere. The amended regulations enable the creation of a register of insolvency practitioners and sets out how insolvency practitioners can qualify to appear on the register. The rules also allow a company to voluntarily apply to be struck off the register of companies under certain conditions. (Qatar Tribune)  DHBK weighs debt sale as default swaps decline – Doha Bank‟s (DHBK) CEO Raghavan Seetharaman said the bank is planning to take on debt in the second half as investor perceptions of the country‟s credit risk improve. He added that options include selling senior or subordinated debt to strengthen the balance sheet by reducing the mismatch between short-term assets and long-term liabilities. According to data provider CMA, five-year credit default swaps insuring Qatari debt declined nine basis points since December 1 to 58 basis points January 07. He said credit default swap rates are coming down significantly from December, so debt procurement is planned. (Bloomberg)  DOHI receives approval from QCB, MEC to increase its capital – Doha Insurance Company‟s (DOHI) Chairman Sheikh Nawaf Bin Nasser Bin Khaled Al Thani announced that the company has received the written approval from both QCB and MEC to increase its capital. DOHI can now raise its capital from QR257.4mn to QR500.0mn by issuing 24,260,000 new shares to its shareholders through a rights issue offered at QR18 per share, QR10 being par value and a premium of QR8. The company is currently in the process of arranging to convene the next EGM on February 17, 2014 to seek shareholders‟ approval for the capital increase. Al Thani said this step comes as part of DOHI‟s vision to increase financial solvency and further improve its credit rating, which would enable the company to compete for mega projects both locally and internationally. (QE)  MPHC’s shareholders to get 4 month profit share – HE the Minister of Finance, Ali Shareef Al Emadi said that Mesaieed Petrochemical Holding Company‟s (MPHC) shareholders will soon be eligible for a profit share for the first four months since the firm‟s establishment in September 2013. The profits will be distributed after MPHC‟s results are announced in March or April. Ali Shareef Al Emadi said that the company earned a net profit of around QR1.6bn in 2012. MPHC, a wholly-owned subsidiary of Qatar Petroleum and an umbrella entity for QChem I, Q-Chem II and Qatar Vinyl Company, is offering 323.19mn ordinary shares (26% stake) at QR10.2 a piece (including QR0.2 listing fees). (Gulf-Times,com)  MPHC clarifies on beneficiary shares under Emiri grant – Mesaieed Petrochemical Holding Company (MPHC) gave a clarification to address certain ambiguities regarding shares provided to beneficiaries under the Emiri grant for the underprivileged. MPHC stated that 100% of the shares as part of the Emiri grant of 750 shares shall be blocked. The statement said shares of minors who are not beneficiaries of the Emiri grant to the less fortunate, whose subscriptions are made on their behalf by their parents or legal guardians will be as follows: 50% of the shares subscribed for on behalf of such minors in the IPO shall be blocked until the minor is of legal age. Once the minor is of legal age, he/she is entitled to deal with those blocked shares. As for the remaining 50% of the shares held by a minor, the minor's guardian is entitled to deal with these shares on the first day of MPHC's listing. The statement noted that if a minor is still under 18 years on the date on which he/she receives shares under MPHC's Incentive Shares program, such shares shall be blocked until the minor attains the age of 18. (Qatar Tribune)  Qatar’s mega water plant to be ready by June 2015 – Qatar‟s mega water distribution system will be ready by the middle of 2015. Eversheds, the global law firm that advised Qatar General Electricity & Water Corporation (Kahramaa) on the 25-year supply deal with Qatar Electricity & Water Company (QEWS), announced that the 36mn imperial gallons per day plant will deliver the first pail of water in June 2015. The law firm also assisted Kahramaa in the financial close of its $500mn Independent Water Plant (IWP). (Peninsula Qatar)  Nakilat Damen Shipyards lays keel for 2 tugboats – Nakilat Damen Shipyards Qatar (NDSQ), a JV between Nakilat and Dutch shipbuilder Damen, has laid the keels for two 16 meterlong stan tugboats. This is part of a seven-vessel order for marine services provider Nakilat SvitzerWijsmuller (NSW), which is owned by Nakilat and Svitzer Middle East. The two twin-screw stan tugs have a bollard pull of 15 tons and will be used for mooring vessels visiting the Port of Ras Laffan. NDSQ is also currently building five other vessels for the NSW order: two 28m-long azimuth stern drive (ASD) tugs, two 31m-long ASD tugs and one 22m-long glass reinforced plastic pilot boat. These boats will be delivered to NSW for use at Ras Laffan port. (Gulf-Times.com)  DHBK’s BoD will meet on January 20 – Doha Bank‟s (DHBK) board of directors will be holding a meeting on January 20, 2014 to discuss its financial results ending on December 31, 2013 and discuss the proposal of profit distribution for FY2013.(QE)  QIBK’s BoD will meet on January 19 – Qatar Islamic Bank‟s (QIBK) board of directors will be holding a meeting on January 19, 2014 to discuss its financial results ending on December 31, 2013. (QE) Page 2 of 5
  3. 3. Qatar Exchange Top 5 Gainers Top 5 Decliners 0.0% 16.0% 13.3% -0.9% -1.0% -1.0% -1.5% 12.0% 9.3% 9.2% 7.6% 8.0% 7.4% -3.0% -3.0% 4.0% -4.5% 0.0% -6.0% -5.3% Islamic Qatar Holding Group International Islamic Bank Doha Insurance Milaha Dlala Holding Source: Qatar Exchange (QE) Qatar General Qatar German Mannai Corp. Qatar United Insurance & Co. for Electricity and Development Reinsurance Medical Water Devices Source: Qatar Exchange (QE) Most Active Shares by Value (QR Million) Most Active Shares by Volume (Million) 400.0 16.0 346.0 291.1 300.0 12.0 253.7 11.1 223.5 200.0 8.0 152.0 5.5 4.5 100.0 0.0 Qatari Investors Group QNB Group Industries Qatar Commercial Bank of Qatar Source: Qatar Exchange (QE) Barwa Real Estate Qatari Investors Group Qatar Gas Transport (Nakilat) 491 Non-Qatari 13.82% 696 80% 1,187 12.83% 34.21% 22.25% 40% 20% Vodafone Qatar Net Traded Value by Nationality (QR Million) 10.21% 28.15% Masraf Al Rayan Source: Qatar Exchange (QE) Investor Trading Percentage to Total Value Traded 60% 3.6 0.0 Barwa Real Estate 100% 4.0 4.0 36.77% (491) 41.76% Qatari 2,201 1,710 0% Buy Sell Qatari Individuals Qatari Institutions Non-Qatari Individuals Non-Qatari Institutions Source: Qatar Exchange (QE) (1,000) (500) - Net Investment 500 1,000 Total Sold 1,500 2,000 2,500 Total Bought Source: Qatar Exchange (QE) Page 3 of 5
  4. 4. TECHNICAL ANALYSIS OF THE QE INDEX Source: Bloomberg The QE Index continued its upward momentum tagging a series of new 52-week highs last week and witnessed gains on every single day, registering impressive gains of around 328 points. The bulls were in full charge as the index breached the 10,600.0, 10,700.0 and 10,800.0 psychological levels ensuring its strong upmove. The index also managed to penetrate above the ascending trendline resistance, which had restricted its bullish move in the past indicating a positive sign. We believe the index has been in strong uptrend mode since forming a base near the 10,320.0 level and may continue its bullish run, targeting the 10,900.0-11,000.0 levels. If the index sustains above this levels, a continued rise and a possibility of a further rally may not be ruled out. The recent uptrend has been sharp, which is keeping the RSI in perpetual overbought state; however, it does not seem to be affecting the index‟s current performance. Meanwhile, the MACD is diverging away from the signal line and is moving up in a bullish manner showing no immediate trend reversal signs, indicating that this rally may not fizzle out soon. On the flip side, traders may need to keep a close watch for support near the ascending trendline, as any dip below this level may result in the index drifting toward the 10,700.0 level. 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. 5. Company Name Price % Change 5(Jan 9) Day % Change YTD Market Cap. QR Million TTM P/E P/B Div. Yield Qatar National Bank 174.50 0.87 1.45 122,103 13.2 2.4 3.4 Qatar Islamic Bank 74.90 7.31 8.55 17,698 16.4 1.5 5.0 Commercial Bank of Qatar 73.70 3.95 4.10 18,237 10.4 1.3 8.1 Doha Bank 63.00 7.14 8.25 16,277 11.0 1.8 6.6 Al Ahli Bank 57.40 4.36 4.36 7,294 14.1 2.1 5.2 Qatar International Islamic Bank 68.00 9.32 10.21 10,293 14.4 2.1 5.1 Masraf Al Rayan 33.40 2.61 6.71 25,050 15.0 2.5 3.0 Al Khaliji Bank 20.80 4.10 4.05 7,488 14.1 1.4 4.8 National Leasing 30.90 2.66 2.49 1,529 13.1 1.2 6.5 Dlala Holding 23.70 7.39 7.24 526 N/M 2.3 N/A Qatar & Oman Investment 13.01 1.72 3.91 410 27.3 1.3 3.8 Islamic Holding Group 51.00 13.33 10.87 204 27.4 3.6 2.2 227,109 Banking and Financial Services Zad Holding 69.30 0.43 (0.29) 907 9.2 0.7 5.8 Qatar German Co. for Medical Devices 13.70 (3.04) (1.08) 158 N/M 0.8 N/A Salam International Investment 13.03 (0.53) 0.15 1,490 11.5 0.9 5.4 Medicare Group 54.70 2.05 4.19 1,539 25.0 2.0 3.3 Qatar Cinema & Film Distribution 41.00 2.12 2.24 234 31.3 1.7 4.9 289.00 0.00 1.72 18,776 15.7 3.1 3.5 53.20 3.30 2.90 958 15.9 3.9 7.5 142.20 6.28 6.68 2,844 19.5 2.3 5.6 Qatar Fuel Qatar Meat and Livestock Al Meera Consumer Goods 26,905 Consumer Goods and Services 51.80 1.97 2.37 2,051 9.7 1.5 5.8 Qatar National Cement 119.00 0.00 0.00 5,843 13.7 2.4 5.0 Industries Qatar 173.90 0.93 2.96 105,210 13.0 3.3 4.4 50.50 5.10 15.56 6,279 26.9 3.0 1.5 4.1 Qatar Industrial Manufacturing Qatari Investors Group 177.80 (0.95) (2.25) 17,780 11.8 3.1 Mannai Corp. 89.00 (1.00) (1.00) 4,060 8.8 1.7 5.3 Aamal 15.00 0.33 0.00 9,000 14.3 1.4 N/A Gulf International Services 67.70 5.29 10.98 10,065 16.6 3.5 2.2 Qatar Electricity and Water 160,288 Industrials Qatar Insurance 71.40 5.78 7.37 9,170 11.2 1.9 2.8 Doha Insurance 27.95 9.18 11.80 719 12.8 1.4 3.3 Qatar General Insurance & Reinsurance 44.50 (5.32) (7.10) 2,565 3.0 0.8 2.0 Al Khaleej Takaful Insurance 37.40 (0.27) 2.47 639 13.3 1.1 2.2 Qatar Islamic Insurance 58.30 2.10 0.69 875 13.7 3.2 6.0 13,968 Insurance United Development 22.95 (0.86) 1.50 7,739 9.5 0.7 4.4 Barwa Real Estate 30.95 1.14 3.86 12,043 17.6 0.9 4.8 Ezdan Real Estate 17.25 1.47 1.47 45,756 N/M 1.6 0.8 Mazaya Qatar Real Estate Development 11.44 0.79 2.33 1,144 17.3 1.1 5.2 66,682 Real Estate 144.00 5.80 4.96 46,126 17.5 1.9 3.5 11.00 (0.18) 2.71 9,299 N/M 1.5 N/A Qatar Navigation (Milaha) 91.00 7.57 9.64 10,422 10.7 0.9 4.1 Gulf Warehousing 41.00 (0.49) (1.20) 1,950 19.6 2.5 N/A Qatar Gas Transport (Nakilat) Transportation 20.75 1.22 2.47 11,620 15.2 3.3 4.8 Qatar Telecom Vodafone Qatar 55,425 Telecoms 23,992 Qatar Exchange 574,370 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