16 April Daily market report


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16 April Daily market report

  1. 1. Page 1 of 6 QE Intra-Day Movement Qatar Commentary The QE index rose 1.1% to close at 12,453.9. Gains were led by the Telecoms and Real Estate indices, gaining 2.3% and 1.4% respectively. Top gainers were Vodafone Qatar and Mannai Corp., rising 10.0% and 5.5% respectively. Among the top losers, Aamal Co. fell 3.2%, while Qatar German Co. for Medical Devices declined 2.8%. GCC Commentary Saudi Arabia: The TASI index fell marginally to close at 9,504.3. Losses were led by the Energy & Uti. and Petro. Ind., falling 3.9% and 0.6% respectively. Weqaya Takaful In. & Rein. fell 7.9%, while Saudi Electricity was down 4.7%. Dubai: The DFM index gained 0.9% to close at 4,728.4. The Real Estate & Construction and Banking Indices rose 1.1% each. Gulf General Investment Co. gained 3.5%, while Dubai Islamic Bank was up 2.6%. Abu Dhabi: The ADX benchmark index rose 0.9% to close at 5,131.6. The Services index gained 4.4%, while the Inv. & Fin. Services Index was up 3.3%. Nat. Corp. For Tou. & Hotels surged 14.9%, while Eshraq Prop. was up 5.7%. Kuwait: The KSE index gained marginally to close at 7,515.5. The Telecommunication index rose 0.6%, while the Banking index was up 0.5%. Zima Holding Co. gained 10.0%, while Jeeran Holding Co. was up 9.4%. Oman: The MSM index rose 0.1% to close at 6,827.1. Gains were led by the Services and Industrial indices, rising 0.2% each. Bank Sohar gained 2.2%, while Construction Materials Ind. was up 1.6%. Bahrain: The BHB index gained 0.3% to close at 1,380.0. The Commercial Banking index rose 0.5%, while the Services Index was up 0.4%. Seef Properties Co. gained 4.0%, while National Bank of Bahrain was up 2.7%. Qatar Exchange Top Gainers Close* 1D% Vol. ‘000 YTD% Vodafone Qatar 15.41 10.0 11,182.5 43.9 Mannai Corp. 105.50 5.5 6.7 17.4 Qatar Islamic Bank 81.70 4.7 319.5 18.4 Qatar International Islamic Bank 82.00 3.8 372.2 32.9 Qatar Islamic Insurance 71.40 3.5 164.0 23.3 Qatar Exchange Top Vol. Trades Close* 1D% Vol. ‘000 YTD% Vodafone Qatar 15.41 10.0 11,182.5 43.9 United Development Co. 23.12 2.7 6,073.4 7.4 Masraf Al Rayan 44.60 3.1 2,330.6 42.5 Barwa Real Estate Co. 37.10 1.0 2,078.8 24.5 Mazaya Qatar Real Estate Dev. 19.54 (0.8) 1,689.0 74.8 Market Indicators 16 Apr 14 15 Apr 14 %Chg. Value Traded (QR mn) 1,138.3 944.5 20.5 Exch. Market Cap. (QR mn) 718,270.3 716,445.2 0.3 Volume (mn) 35.2 26.0 35.0 Number of Transactions 12,111 12,101 0.1 Companies Traded 42 42 0.0 Market Breadth 25:15 31:9 – Market Indices Close 1D% WTD% YTD% TTM P/E Total Return 18,571.40 1.1 0.5 25.2 N/A All Share Index 3,214.61 0.8 0.5 24.2 15.5 Banks 3,048.76 1.4 0.2 24.8 15.1 Industrials 4,331.57 (0.5) 0.6 23.8 16.2 Transportation 2,245.55 (0.3) 0.3 20.8 14.8 Real Estate 2,477.74 1.4 0.2 26.9 15.9 Insurance 3,244.10 1.1 2.7 38.9 8.6 Telecoms 1,685.08 2.3 2.0 15.9 23.9 Consumer 7,515.84 0.7 (0.2) 26.4 30.6 Al Rayan Islamic Index 4,042.57 2.0 0.9 33.1 18.6 GCC Top Gainers## Exchange Close# 1D% Vol. ‘000 YTD% Vodafone Qatar Qatar 15.41 10.0 11182.5 43.9 Mannai Corporation Qatar 105.50 5.5 6.7 17.4 Nat Marine Dred. Co Abu Dhabi 8.50 4.8 3.5 (1.2) Qatar Islamic Bank Qatar 81.70 4.7 319.5 18.4 Hail Cement Saudi Arabia 25.99 4.2 1976.4 22.0 GCC Top Losers## Exchange Close# 1D% Vol. ‘000 YTD% Saudi Electricity Co Saudi Arabia 14.87 (4.9) 5329.5 2.2 Co For Coop. Ins. Saudi Arabia 38.67 (3.5) 1493.4 9.9 Sahara Petrochem. Co. Saudi Arabia 20.43 (3.3) 7071.6 3.2 Aamal Co. Qatar 17.77 (3.2) 707.3 18.5 Abu Dhabi Nat. Ins. Abu Dhabi 6.30 (3.1) 0.3 6.8 Source: Bloomberg ( # in Local Currency) ( ## GCC Top gainers/losers derived from the Bloomberg GCC 200 Index comprising of the top 200 regional equities based on market capitalization and liquidity) Qatar Exchange Top Losers Close* 1D% Vol. ‘000 YTD% Aamal Co. 17.77 (3.2) 707.3 18.5 Qatar German Co. for Med. Dev. 14.00 (2.8) 175.9 1.1 Ezdan Holding Group 28.50 (2.4) 475.7 67.6 Qatari Investors Group 60.80 (1.9) 420.8 39.1 Salam International Investment Co 13.92 (1.6) 1,672.4 7.0 Qatar Exchange Top Val. Trades Close* 1D% Val. ‘000 YTD% Vodafone Qatar 15.41 10.0 167,111.9 43.9 United Development Co. 23.12 2.7 139,951.1 7.4 Masraf Al Rayan 44.60 3.1 102,310.5 42.5 Barwa Real Estate Co. 37.10 1.0 76,413.3 24.5 QNB Group 194.00 (0.5) 60,152.0 12.8 Source: Bloomberg (* in QR) Regional Indices Close 1D% WTD% MTD% YTD% Exch. Val. Traded ($ mn) Exchange Mkt. Cap. ($ mn) P/E** P/B** Dividend Yield Qatar* 12,453.86 1.1 0.5 7.0 20.0 312.64 197,237.0 15.8 2.0 4.0 Dubai 4,728.38 0.9 (2.3) 6.2 40.3 285.01 93,866.1 20.3 1.8 2.1 Abu Dhabi 5,131.62 0.9 (0.8) 4.8 19.6 387.63 134,112.4 15.6 1.8 3.4 Saudi Arabia 9,504.33 (0.0) (0.0) 0.3 11.3 2,732.62 515,997.3 19.9 2.4 2.9 Kuwait 7,515.54 0.0 (0.8) (0.8) (0.5) 167.01 118,421.6 16.6 1.2 4.0 Oman 6,827.10 0.1 0.3 (0.4) (0.1) 23.59 24,565.1 11.3 1.6 3.9 Bahrain 1,380.03 0.3 (0.2) 1.7 10.5 0.33 52,718.9 9.7 0.9 5.0 Source: Bloomberg, Qatar Exchange, Tadawul, Muscat Securities Exchange, Dubai Financial Market and Zawya (** TTM; * Value traded ($ mn) do not include special trades, if any) 12,250 12,300 12,350 12,400 12,450 12,500 9:30 10:00 10:30 11:00 11:30 12:00 12:30 13:00
  2. 2. Page 2 of 6 Qatar Market Commentary  The QE index rose 1.1% to close at 12,453.9. The Telecoms and Real Estate indices led the gains. The index rose on the back of buying support from non-Qatari shareholders despite selling pressure from Qatari shareholders.  Vodafone Qatar and Mannai Corp. were the top gainers, rising 10.0% and 5.5% respectively. Among the top losers, Aamal Co. fell 3.2%, while Qatar German Co. for Medical Devices declined 2.8%.  Volume of shares traded on Wednesday rose by 35.0% to 35.2mn from 26.0mn on Tuesday. Further, as compared to the 30-day moving average of 21.5mn, volume for the day was 63.4% higher. Vodafone Qatar and United Development Co. were the most active stocks, contributing 31.8% and 17.3% to the total volume respectively. Source: Qatar Exchange (* as a % of traded value) Earnings and Global Economic Data Earnings Releases Company Market Currency Revenue (mn)1Q2014 % Change YoY Operating Profit (mn) 1Q2014 % Change YoY Net Profit (mn) 1Q2014 % Change YoY Mobile Telecommunications Co. Saudi Arabia (Zain KSA) Saudi SR – – -127.0 NA -318.0 NA Alinma Tokio Marine Co. Saudi SR 11.4 NA – – -6.5 NA Saudi Enaya Cooperative Insurance Co. Saudi SR 12.2 1124.4% – – -11.5 NA BUPA Arabia for Cooperative Insurance Co. Saudi SR 1,420.0 72.3% – – -20.8 NA Aldrees Petroleum & Transport Services Co. (APTSCO) Saudi SR – – 32.6 26.4% 30.5 29.2% Al Abdullatif Industrial Investment Co. (AIIC) Saudi SR – – 59.4 -17.0% 59.9 -11.8% Malath Cooperative Insurance & Reinsurance Co. Saudi SR 346.8 101.9% – – -9.7 NA Rabigh Refining & Petrochemical Co. (Petro Rabigh) Saudi SR – – 416.3 NA 413.1 NA National Metal Manufacturing & Casting Co. (Maadaniyah) Saudi SR – – 10.3 127.8% 7.7 161.5% Hail Cement Co. (HCC) Saudi SR – – 36.3 NA 35.1 NA Saudi Public Transport Co. (SAPTCO) Saudi SR – – 20.4 124.3% 21.1 5.1% Al Jouf Agricultural Development Co. Saudi SR – – 5.5 38.3% 5.2 -36.1% The National Shipping Co. of Saudi Arabia (Bahri) Saudi SR – – 166.7 113.2% 195.1 41.3% Saudi Arabian Refineries Co. (Al Masafe) Saudi SR – – 3.0 278.2% 2.9 302.8% The Co. for Cooperative Insurance (Tawuniya) Saudi SR 1.3 21.4% – – 39.7 NA United Real Estate Co. (UREC) * Kuwait KD – – 20.0 NA 11.2 NA Gulf Investment Services Holding Co. (GIS) Oman OMR 2.4 3.6% – – 2.0 17.8% Source: Company data, DFM, ADX, MSM (*FY2013 results) Global Economic Data Date Market Source Indicator Period Actual Consensus Previous 04/16 US MBA MBA Mortgage Applications 11-April 4.30% – -1.60% 04/16 US US Census Bureau Housing Starts March 946K 970K 920K 04/16 US US Census Bureau Housing Starts MoM March 2.80% 7.00% 1.90% 04/16 US US Census Bureau Building Permits March 990K 1010K 1014K 04/16 US US Census Bureau Building Permits MoM March -2.40% -0.40% 7.30% 04/16 US Federal Reserve Industrial Production MoM March 0.70% 0.50% 1.20% 04/16 US Federal Reserve Capacity Utilization March 79.20% 78.70% 78.80% 04/16 EU Eurostat CPI MoM March 0.90% 1.00% 0.30% 04/16 EU Eurostat CPI YoY March 0.50% 0.50% 0.50% Overall Activity Buy %* Sell %* Net (QR) Qatari 69.61% 74.71% (58,002,601.54) Non-Qatari 30.39% 25.30% 58,002,601.54
  3. 3. Page 3 of 6 04/16 EU Eurostat CPI Core YoY March 0.70% 0.80% 0.80% 04/16 UK ONS Jobless Claims Change March -30.4K -30.0K -37.0K 04/16 UK ONSt ILO Unemployment Rate 3Mths February 6.90% 7.10% 7.20% 04/16 UK ONS Employment Change 3M/3M February 239K 90K 105K 04/16 Italy Banca D'Italia Current Account Balance February 298M – -1255M 04/16 China NBS Retail Sales YTD YoY March 12.00% 11.90% 11.80% 04/16 China NBS Retail Sales YoY March 12.20% 12.10% – 04/16 China NBS Industrial Production YTD YoY March 8.70% 8.80% 8.60% 04/16 China NBS Industrial Production YoY March 8.80% 9.00% – 04/16 China NBS GDP YTD YoY 1Q2014 7.40% 7.30% 7.70% 04/16 China NBS GDP SA QoQ 1Q2014 1.40% 1.50% 1.70% 04/16 China NBS GDP YoY 1Q2014 7.40% 7.30% 7.70% 04/16 Japan METI Industrial Production MoM February -2.30% – -2.40% 04/16 Japan METI Industrial Production YoY February 7.00% – 6.90% 04/16 Japan METI Capacity Utilization MoM February -2.60% – 6.20% Source: Bloomberg (s.a. = seasonally adjusted; n.s.a. = non-seasonally adjusted; w.d.a. = working day adjusted) News Qatar  QIBK’s net profit drops by 6.9% QoQ in 1Q2014 – QIBK posted a net profit (to equity) of QR335.4mn in 1Q2014 vs. BBG consensus estimate of QR322.2mn. On a QoQ basis, the net income was down 6.9%. However, on a YoY basis the net income was up 15.2%. QIBK‟s loan book expanded by 4.4% year-to-date (YTD) to QR49.2bn from QR47.1bn in 2013. However, equity of unrestricted investment account holders (URIA) jumped by 17.4% YTD to QR44.5bn from QR37.9bn. Furthermore, customers deposits in current accounts increased by 14.2% YTD to QR 14.2bn vs. QR12.5bn at the end of 2013. Hence, the loan-to-deposit ratio dropped 83.8% vs. 93.6% at the end of 2013. In terms of the investment book, total investments decreased by 20.0% YTD. The decline primary came in debt securities, especially the State of Qatar debt, which declined by 28.2%. In our discussions with management of various banks, we have learnt that the recently matured government debt has not yet been fully reinvested. Furthermore, the rate of return is lower than earlier terms. We maintain our estimates; retaining our Market Perform rating and target price of QR73.27. We expect QIBK to post EPS of QR6.19 and QR6.96 for 2014 and 2015, respectively. Furthermore, we maintain QIBK‟s target price at QR73.27 and Market Perform rating. Valuation appears fair. QIBK is trading at a P/E and a P/B of 13.2x and 1.6x on our 2014 estimates, respectively. QIBK has underperformed the sector index. In 2014 (YTD), the stock is up 18.4% vs. the QE All Share Banks & Financial Services Index, which is up 24.8%. (QNBFS Research, QE)  GWCS’ net profit rises by 7.7% QoQ in 1Q2014 – Gulf Warehousing Co. (GWCS) reported a net profit of QR28.9mn vs. our estimate of QR28.9mn and net income of QR26.8mn in 4Q2013. Overall revenue increased to QR152.9mn in 1Q2014 vs. QR127.9mn in 4Q2013, a growth of 19.6% QoQ. Logistics operations (including LVQ) contributed QR104.8mn while freight forwarding contributed QR48.1mn. In our view, the growth primarily came from LVQ Phase 3‟s greater occupancy levels. Direct costs were QR98.9mn, while interest charges were QR8.6mn for the quarter. Going forward, we expect net income to grow by 20.9% and 44.8% in 2014 and 2015, respectively. We expect better operating performance in 2014 & 2015 on the back of LVQ Phases 3 & 4. In 2014, we expect the full impact of Phase 3, along with an incremental benefit of LVQ Phase 4. However, the full impact of Phase 4 will be visible in 2015. We expect GWCS‟ bottom-line to increase by 20.9% YoY in 2014 and 44.8% YoY in 2015. We maintain our estimates with a price target of QR51.35 but change our rating to Reduce. We expect better operating performance in 2014 & 2015 on the back of LVQ Phase 3 & 4. However, given the recent stock‟s appreciation (up 41.2% with a total return of 46.5% on a year-to- date basis), we change our rating to Reduce. The company trades at a premium to its regional and global peers. The stock trades at a P/E ratio of 22.7x on our 2014 estimates and offers a dividend yield of 3.4%. (QNBFS Research, QE)  DOHI net profit drops 16.6% to QR23.3mn in 1Q2014 – Doha Insurance Co. (DOHI) posted a net profit of QR23.3mn in 1Q2014, down 16.6% QoQ (+9.4% YoY). Net underwriting income decreased by 24.0% QoQ (+3.3% YoY), reaching QR18.4mn. On the other hand, investment & other income jumped 13.2% QoQ (+25.1% YoY), reaching QR19.4mn. (QE)  Qatar to invest QR664bn in infrastructure in 5 years – The Minister of Economy & Trade, HE Sheikh Ahmed bin Jassim Al Thani, said that Qatar will invest around QR664bn on infrastructure projects, excluding projects in oil & gas sector, over the next five years. The minister stated that there are 432 building materials manufacturing companies in Qatar worth $10.4bn. These companies employ roughly 37,000 people in the areas of cement, gypsum, sand, stones, glass and fibre glass used in building materials and plastic materials, which has assumed significance in Qatar in light of the unprecedented boom in the construction and real estate sector. (GulfBase.com)  Qatar’s real estate price index hits record high – The Qatar Central Bank‟s (QCB) quarterly update of the 2014 real estate price index has confirmed that the country‟s real estate prices are on the uptick. QCB‟s real estate price index reached a record 209.4 points in March 2014 from 180.1 points in the same period last year – an increase of 16.3% year-on-year. The index has been steadily growing over the past three months to hit the record high in March. QNB Group has analyzed data purely on land transactions in Qatar, based on weekly statistics published by the Ministry of Justice which suggests that land prices are a fundamental driver of rent inflation in Qatar with a six-month lag. A recovery in land prices in recent months is expected to increase rents later this year. (QNB Group, Peninsula Qatar)  DHBK to buy HSBC Oman’s India business – Doha Bank (DHBK) Chairman Sheikh Fahad bin Mohamed bin Jabor al- Thani said the bank has entered into an agreement with HSBC Bank Oman, to purchase HSBC Oman‟s banking business in India. He stated that all staff working in this operation would be transferred to DHBK as a part of the purchase. The business being acquired consists of HSBC Oman‟s two branches and
  4. 4. Page 4 of 6 gross assets of $58mn as on December 31, 2013. Sheikh Fahad also stated that the transaction was subject to approvals from regulatory authorities in Qatar, India, Oman and Jersey. (Gulf- Times.com)  EY: Qatar hotel room yield grows in double-digits on robust occupancy – According to Ernst & Young (EY), the hotel industry in Qatar has opened the year 2014 on a positive note with its rooms‟ yield growing in double-digits on the back of robust occupancy and average room rates. EY in its Middle East Hotel Benchmark survey said in comparison, the hospitality industry in most of the neighboring countries witnessed slower gains in rooms‟ yield YoY in January 2014. Hotels in Doha, where occupancy grew 9% to reach 70%, saw their room‟s yield expand 21.1% to $171 with their average room rate growing 5.7% to QR243. (Gulf-Times.com)  QDB, Qatar Shell offer 7 new business opportunities to SMEs – The Qatar Development Bank (QDB) and Qatar Shell have revealed seven new business opportunities for SMEs during the annual SME Business Opportunity Workshop. QDB‟s CEO Abdulaziz al-Khalifa said that the representatives of shortlisted SMEs who participated in the event have been offered business opportunities in the fields of manufacturing, maintenance, repair, and recertification, services and onsite technical support.. (Gulf-Times.com)  DBIS to disclose 1Q2014 results on April 28 – Dlala Brokerage & Investments Holding Company (DBIS) announced that it will disclose its 1Q2014 financial results on April 28, 2014. (QE) International  Reuters: World economy on steady course at best, China a worry – A poll by Reuters has showed that the world economy can expect steady growth at best over the coming years, but any rapid slowdown in China as it tries to rebalance its economy could upset the unsteady progress. Growth in the US looks set to outpace its peers, with Japan and the Eurozone still lagging, while emerging markets – particularly Latin America – facing a challenging year. The poll results suggest that exuberance in financial markets, especially stock markets, may have been overdone in the past few years on expectations for a robust pick-up in global growth. With a few notable exceptions like Britain, developed economies are also showing scant evidence of an imminent improvement in hiring, particularly so in the Eurozone and the US. (Reuters)  Yellen: Weak US prices the main threat not inflation – The US Federal Reserve Chair Janet Yellen said that persistently low inflation poses a more immediate threat to the US economy than rising prices, stressing that the central bank would be delivering policy stimulus for some more time to come. In her second public speech since taking the Fed's helm, Yellen was careful not to predict when interest rates would rise from the current near zero level. Instead, she stressed that the decision would hinge on healing in the US labor market and on how briskly inflation rises toward the Fed's 2% goal. Further, Yellen stated that since inflation is running at around 1%, the greater risk at this point is about inflation undershooting the Fed‟s goal. (Reuters)  Eurozone inflation still in danger zone, keeps ECB under pressure – According to the European Union's statistics office Eurostat, Eurozone‟s inflation has dropped to its lowest level since November 2009, keeping pressure on the European Central Bank to intervene if prices do not rebound. The YoY inflation rate across the 18 countries sharing the Euro stood at 0.5% in March 2014, down from 0.7% in February, said. It was the sixth straight month that inflation remained in what the ECB President Mario Draghi called a "danger zone" of below 1%. Core inflation, excluding energy, food, alcohol & tobacco dropped to 0.7% from 1.0%. Excluding unprocessed food and energy, inflation stood at 0.9%, more than the 0.8% economists had forecast, but still less than February's reading of 1.1%. (Reuters)  BoJ maintains positive view on economy – The Bank of Japan‟s (BoJ) Governor Haruhiko Kuroda affirmed the central bank's upbeat view on the Japanese economy, even as global financial markets wobbled, stressing that growth will pick up by mid-year as the sting from the sales tax hike fades. Kuroda added that price rises will broaden as the economy continues to improve gradually, reiterating his view that Japan is making headway toward the central bank's price goal of 2% inflation in about a year's time. Kuroda agreed that a wide range of companies, especially among auto makers and retailers, do hold a more cautious view about the economic outlook, but the level of confidence remains high and corporate capital spending plans for FY2014-15 is solid. (Reuters) Regional  Saudi oil exports reach SR289bn in 1Q2014 – According to sources, oil exports from Saudi Arabia reached 715.72mn barrels in 1Q2014, with proceeds amounting to SR288.91bn. On the other hand, domestic consumption during 1Q2014 stood at 176mn barrels, constituting 20% of the total output. (GulfBase.com)  Reuters: Saudi tops in research, innovation among G20 states – Thomson Reuters has released „The Research & Innovation Performance of the G20‟, a report that studies scientific research and patent information across the G20 countries. According to this report, Saudi Arabia has achieved the highest growth in output over the last decade in the G20 with 373% growth, from a low base of just 1,474 web of science papers in 2003. Its 6,978 papers in 2012 amounted to 6% of the world share, up from 2% at the beginning of the period. (GulfBase.com)  Tadawul deposits Al Khaleej’s bonus shares – The Saudi Stock Exchange (Tadawul) announced the addition of Al Khaleej Training & Education Company‟s (Al Khaleej) bonus shares into its investors‟ portfolios. Earlier, Al Khaleej‟s EGM had approved an increase in the company‟s capital via bonus shares. The fluctuation limit for the company‟s shares on April 16, 2014 will be based on a stock price of SR53.30. (Tadawul)  SEC plans 17 new power projects worth SR7.2bn – The Saudi Electricity Company (SEC) will implement 17 new projects worth SR7.2bn as part of its efforts to meet the growing demand for energy. They include new transformer stations in Waed Al- Shamal, Gurayat, Tabarjal, Al-Jouf and Arar at a cost of SR2.3bn, which have to be implemented in 29 months. The projects also include the establishment of 380KV transport lines from Tabarjal to Al-Jouf, from Al-Jouf to Arar and from Tabuk to Tabarjal at a total cost of SR1.4bn. Other power generation projects have been planned for Al-Oqair, Jawatha, Abqaiq, Madhaya, Al-Khafji, Taif, Madinah, and Riyadh. These new projects will be financed from the company‟s own funds, government loans and commercial loans. (GulfBase.com)  Zain Saudi 1Q2014 net loss narrows down – Telecom operator Zain Saudi reported a narrowing loss in 1Q2014, beating analyst forecasts. Saudi Arabia's third largest mobile company, which is 37% owned by Kuwait's Zain, made a net loss of SR318mn in the three months to March 31. This
  5. 5. Page 5 of 6 compares with a net loss of SR398mn in the prior-year period. (Reuters)  UAE inflation at 1.9% in March – According to the National Bureau of Statistics, annual inflation in the UAE edged up to 1.9% in March, its highest level since October 2010, from 1.8% in February. (Reuters)  UAE healthcare investment to grow at 16% CAGR – According to a report by the US-UAE Business Council, healthcare spending in the UAE reached an estimated $16.8bn in 2013. Further, it is expected to grow at a compound annual growth rate (CAGR) of over 16% in 2014. The report found that the UAE healthcare sector has made significant strides through partnership with US companies. (GulfBase.com)  SIB posts 30% rise in profits – Sharjah Islamic Bank (SIB) announced its 1Q2014 results with net profits reaching AED110mn, compared to the AED84.8mn achieved in the same period last year, a 30% growth rate. Net customer facilities reached AED13.3bn rising by AED803.3mn, a 6.4% increase since December 2013 and customer deposits reached AED12.3bn rising by AED355.8mn, or a 3% growth since December 2013. Total assets reached AED22.1mn, growing by 1.8% since December 2013. SIB shareholder‟s equity of 4.4bn represents 19.9% of the total balance sheet footing reflecting the bank‟s strong capital base and strong financial position that enables the bank to achieve its strategic objectives. (Bloomberg)  Dubai inflation increases to 2.59% in 1Q2014 – According to the data from the Dubai Statistics Centre, Inflation in Dubai rose to 2.59% in the 1Q2014 as compared to the same period of 2013, mainly due to an increase in the prices of goods and services. However, on a MoM basis, Dubai‟s inflation declined 0.4% in March from 3.4% in February. Overall in the UAE, inflation surged to 0.2% MoM and 1.9% YoY in March from 0.1% and 1.8% respectively in February. Rising housing costs contributed the most to fuelling inflation last month. With the biggest weighting in the index at 39%, housing costs rose 0.6% MoM and 2.4% per YoY. Dubai Statistics Centre data shows that costs of housing, water, electricity and gas rose by 4.38%, food and non-alcoholic beverages by 4.04%, education by 3.99%, alcoholic beverages and tobacco by 3.33%, health by 1.93%, restaurants and hotels by 1.67%, miscellaneous goods and services by 1.22%, furnishings, household equipment and routine household maintenance by 1.16%, transport by 0.85% and recreation and culture increased by 0.42%. (Bloomberg)  Lite-Tech unveils LED technology to cut lighting cost by half – Lite-Tech Industries is planning to offer its entire range of energy-efficient LED lighting products and technologies across the Middle East. Lite-Tech is a subsidiary of Dubai Investments and a joint venture with Philips Lighting. LED lighting can save up to 85% energy as compared to traditional light solutions with a similar light output. (GulfBase.com)  CBD signs MoU with Hamriyah Free Zone – The Commercial Bank of Dubai (CBD) has signed a MoU with Hamriyah Free Zone Authority to provide banking services to companies that are based in the zone, as well as firms that are planning to establish their operations. As the preferred financial services provider, CBD will be tasked with helping finance projects executed in the zone. In addition, CBD is expected to provide full banking services such as new accounts, e-services and financial arrangements, along with a bundle of personal banking products designed for free zone employees. (GulfBase.com)  TAQA begins storing gas at Dutch facility – Abu Dhabi National Energy Company (TAQA) has started injecting natural gas into its partially built Bergermeer storage facility in the Netherlands. TAQA has invested in the project alongside Dutch energy company, EBN. The Bergermeer facility, which is scheduled to be completed in April 2015, will nearly double the Netherlands' gas storage capacity. After completion, it will provide 4.1bn cubic meters of gas storage capacity, equivalent to the average annual gas consumption of 2.5mn Dutch households. (GulfBase.com)  Etihad signs deal with Fiji Airways – Etihad Airways and Fiji Airways have signed an agreement that will cement ties between the two carriers in the future. The interline agreement will allow each airline to sell seats for the other to facilitate easier travel and booking connections for passengers. Besides, it will allow the sale from and to 12 cities in Europe, 17 in the Middle East, five each in Africa and North America, 29 in Asia and three in Australia – to and from Fiji. (GulfBase.com)  Bank Muscat reports profit of OMR39.76mn for 1Q2014 – Bank Muscat has reported net profit of OMR39.76mn for 1Q2014 as compared to OMR24.99mn for 1Q2013. Net interest income from conventional banking and income from Islamic financing stood at OMR59.15mn for 1Q2014 as compared to OMR56.42mn for 1Q2013 with an increase of 4.8%. Net Loans and advances increased by 8.8% to OMR5.968bn as against OMR5.486bn as at March 31, 2013. Customer deposits, including CDs, increased by 11% to OMR6.112bn as against OMR5.506bn as at March 31, 2013. (MSM)  GFH EGM approves $500mn sukuk – Bahrain-based Islamic investment bank, Gulf Finance House‟s (GFH) EGM has approved issuance of sukuk of up to $500mn. The funds will be used to restructure the current liabilities, develop projects and for acquisitions of new businesses for the benefit of the bank. (GulfBase.com)  Bahrain Works Ministry awards BHD12mn tenders in 1Q2014 – Bahrain‟s Ministry of Works has awarded 21 tenders worth BHD12mn during 1Q2014. The ministry has invited bids for 18 tenders worth BHD44.8mn. Three projects to construct schools worth BHD11.3mn have also been awarded. (GulfBase.com)  NBB’s profit increases 12.1% to reach BHD16.62mn in 1Q2014 – National Bank of Bahrain (NBB) recorded a net profit of BHD16.62mn for 1Q2014 as compared to BHD14.83mn for 1Q2013, reflecting an increase of 12.1%. The net interest income for 1Q2014 stood at BHD15.57mn as compared to BHD14.21mn for 1Q2013 with an increase of 9.6%. Bank‟s total assets stood at BHD2.75bn as at March 31, 2014 as compared to BHD2.62bn a year earlier. Customer deposits as at March 31, 2014 stood at BHD2.099bn as compared to BHD2.075bn as at March 31, 2013. EPS amounted to 17.7fils as compared to 15.8 fils a year earlier. (Bahrain Bourse)  AUB considers sale or merger – According to sources, Ahli United Bank (AUB) is evaluating a sale or a merger with a rival bank in a potential $5bn deal. According to Thomson Reuters, a deal of this size would be the largest banking transaction in the region for the past 20 years, beating Emirates Bank's $3.7bn acquisition of the National Bank of Dubai in 2007 and QNB Group‟s $1.9bn purchase of Societe Generale's Egyptian business in 2012. It could also mark a revival of significant M&A activity in the Gulf where mergers tend to be difficult because major shareholders can be reluctant to cede control unless they get a generous price. (Reuters)
  6. 6. Contacts Saugata Sarkar Keith Whitney Sahbi Kasraoui Head of Research Head of Sales Manager - HNWI Tel: (+974) 4476 6534 Tel: (+974) 4476 6533 Tel: (+974) 4476 6544 saugata.sarkar@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 or 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 6 of 6 Rebased Performance Daily Index Performance Source: Bloomberg Source: Bloomberg Source: Bloomberg (*Market closed on April 16, 2014) Source: Bloomberg 80.0 90.0 100.0 110.0 120.0 130.0 140.0 150.0 160.0 170.0 180.0 190.0 Jun-10 Jan-11 Aug-11 Mar-12 Oct-12 May-13 Dec-13 QE Index S&P Pan Arab S&P GCC (0.0%) 1.1% 0.0% 0.3% 0.1% 0.9% 0.9% (0.4%) 0.0% 0.4% 0.8% 1.2% SaudiArabia Qatar Kuwait Bahrain Oman AbuDhabi Dubai Asset/Currency Performance Close ($) 1D% WTD% YTD% Global Indices Performance Close 1D% WTD% YTD% Gold/Ounce 1,302.55 (0.0) (1.2) 8.0 DJ Industrial 16,424.85 1.0 2.5 (0.9) Silver/Ounce 19.67 0.3 (1.7) 1.0 S&P 500 1,862.31 1.0 2.6 0.8 Crude Oil (Brent)/Barrel (FM Future) 109.60 0.8 2.1 (1.1) NASDAQ 100 4,086.23 1.3 2.2 (2.2) Natural Gas (Henry Hub)/MMBtu 4.62 (0.9) (0.5) 6.5 STOXX 600 330.82 1.3 0.6 0.8 LPG Propane (Arab Gulf)/Ton 112.63 (0.2) 1.7 (11.0) DAX 9,317.82 1.6 0.0 (2.5) LPG Butane (Arab Gulf)/Ton 125.75 1.6 1.8 (7.4) FTSE 100 6,584.17 0.7 0.3 (2.4) Euro 1.38 0.0 (0.5) 0.5 CAC 40 4,405.66 1.4 0.9 2.6 Yen 102.23 0.3 0.6 (2.9) Nikkei 14,417.68 3.0 3.3 (11.5) GBP 1.68 0.4 0.4 1.4 MSCI EM 1,002.50 0.3 (1.3) (0.0) CHF 1.13 (0.2) (0.7) 1.3 SHANGHAI SE Composite 2,105.12 0.2 (1.2) (0.5) AUD 0.94 0.1 (0.3) 5.1 HANG SENG 22,696.01 0.1 (1.3) (2.6) USD Index* 79.80 0.0 0.4 (0.3) BSE SENSEX 22,277.23 (0.9) (1.6) 5.2 RUB 35.99 (0.5) 1.0 9.5 Bovespa 51,200.56 1.5 (1.3) (0.6) BRL 0.45 (0.4) (1.1) 5.4 RTS 1,154.31 1.0 (4.1) (20.0) 179.0 152.5 139.0