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Page 1 of 5
Market Review and Outlook QE Index and Volume
The Qatar Exchange (QE) Index gained 199.02 points, or 1.55%,
Page 2 of 5
Economic News
 QCB auctions T-bills worth QR4bn – The Qatar Central Bank
(QCB) has auctioned treasury bi...
Page 3 of 5
Qatar Exchange
Top 5 Gainers Top 5 Decliners
Source: Qatar Exchange (QE) Source: Qatar Exchange (QE)
Most Acti...
Page 4 of 5
Source: Bloomberg
The QE Index ended the volatile week on a bullish note. T...
Saugata Sarkar Abdullah Amin, CFA Shahan Keushgerian
Head of Research Senior Research Analyst Senior Research Ana...
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Weekly market report


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Weekly market report

  1. 1. Page 1 of 5 Market Review and Outlook QE Index and Volume The Qatar Exchange (QE) Index gained 199.02 points, or 1.55%, during the trading week, to close at 13,076.33 points. Market capitalization increased by 0.77% to reach QR695.6 billion (bn) as compared to QR690.2bn at the end of the previous week. Of the 43 listed companies, 38 companies ended the week higher, while 5 fell. Mazaya Qatar Real Estate Development Co. (MRDS) was the best performing stock for the week, with a gain of 19.78% on 19.4 million (mn) shares traded; the stock is up 97.14% year-to-date (YTD). On the other hand, Industries Qatar (IQCD) was the worst performing stock, with a decline of 2.19% on only 1.3mn shares traded; the stock is still up 0.41% year-to-date (YTD). Qatar Islamic Bank (QIBK), Qatari Investors Group (QIGD) and Nakilat (QGTS) were the biggest contributors to the weekly index gain. QIBK contributed 27.30 points to the index’s weekly gain of 199.02 points. The stock has been one of the best performing stocks in 2014 year-to-date (YTD) with a price return of 58.26%. QIGD contributed 25.76 points. QGTS was the third biggest contributor with a contribution of 24.16 points. On the other hand within the QE Index, IQCD, Commercial Bank of Qatar (CBQK) and Al Khalij Commercial Bank (KCBK) ended in negative territory. CBQK and KCBK were down by 1.47% and 1.11% week-over-week, respectively. Trading value during the week increased by 611.9% to reach QR3.4bn vs. QR473.1mn in the prior week (shortened 1 day trading weak due to holidays). The Banks & Financial Services sector led the trading value during the week, accounting for 30.4% of the total equity trading value. MRDS was the top value traded stock during the week with total traded value of QR402.6mn. Trading volume increased by 656.1% to reach 85.1mn shares vs. 11.3mn shares in the prior week (shortened 1 day trading weak due to holidays). The number of transactions increased by 635.9% to reach 37,227 transactions versus 5,059 transactions in the prior week. The Real Estate sector led the trading volume, accounting for 47.4%. MRDS was also the top volume traded stock during the week with total traded volume of 19.4mn shares. Foreign institutions remained bullish during the week with net buying of QR143.1mn vs. QR98.1mn in the prior week. Qatari institutions turned bearish with net selling of QR63.3mn vs. net buying of QR155.8mn the week before. Foreign retail investors turned bearish for the week with net selling of QR1.3mn vs. net buying of QR24.4mn in the prior week. Qatari retail investors remained bearish with net selling of QR78.1mn vs. net selling of QR278.3mn the week before. Thus far in 2014, the QE has already witnessed net foreign portfolio investment inflow of ~$2.1bn. Market Indicators Week ended August 07, 2014 Week ended July 27, 2014 Chg. % Value Traded (QR mn) 3,367.8 473.1 611.9 Exch. Market Cap. (QR mn) 695,561.8 690,245.7 0.8 Volume (mn) 85.1 11.3 656.1 Number of Transactions 37,227 5,059 635.9 Companies Traded 43 39 10.3 Market Breadth 38:5 19:17 – Market Indices Close WTD% MTD% YTD% Total Return 19,503.23 1.5 1.5 31.5 All Share Index 3,305.93 1.6 1.6 27.8 Banks/Financial Svcs. 3,167.83 0.8 0.8 29.6 Industrials 4,289.52 0.3 0.3 22.6 Transportation 2,327.48 4.4 4.4 25.2 Real Estate 2,832.92 5.5 5.5 45.1 Insurance 3,847.25 2.5 2.5 64.7 Telecoms 1,598.70 1.3 1.3 10.0 Consumer 7,345.60 4.7 4.7 23.5 Al Rayan Islamic Index 4,477.65 4.3 4.3 47.5 Market Indices Weekly Index Performance Regional Indices Close WTD% MTD% YTD% Weekly Exchange Traded Value ($ mn) Exchange Mkt. Cap. ($ mn) TTM P/E** P/B** Dividend Yield Qatar (QE)* 13,076.33 1.5 1.5 26.0 979.59 191,001.3 16.1 2.2 3.8 Dubai 4,734.76 (2.0) (2.0) 40.5 1,193.73 92,657.0 20.9 1.8 2.2 Abu Dhabi 4,925.14 (2.6) (2.6) 14.8 287.58 135,597.9 14.0 1.7 3.4 Saudi Arabia# 10,478.34 2.6 2.6 22.8 11,307.34 571,126.1 20.1 2.5 2.7 Kuwait 7,186.42 0.8 0.8 (4.8) 260.66 113,008.6 17.1 1.1 3.8 Oman 7,336.40 1.9 1.9 7.3 91.84 26,947.4 11.4 1.8 3.8 Bahrain 1,494.03 1.5 1.5 19.6 40.70 54,577.1 11.9 1.0 4.6 Source: Bloomberg, country exchanges and Zawya (** Trailing Twelve Months; * Value traded ($ mn) do not include special trades, if any) (# Data as of August 06, 2014) 12,865.50 12,991.23 13,173.64 13,103.45 13,076.33 0 15,000,000 30,000,000 12,700 12,950 13,200 3-Aug 4-Aug 5-Aug 6-Aug 7-Aug Volume QE Index 2.6% 1.9% 1.5% 1.5% 0.8% (2.0%) (2.6%)(4.0%) 0.0% 4.0% SaudiArabia Oman Qatar(QE)* Bahrain Kuwait Dubai AbuDhabi
  2. 2. Page 2 of 5 News Economic News  QCB auctions T-bills worth QR4bn – The Qatar Central Bank (QCB) has auctioned treasury bills worth QR4bn on August 5, 2014, for which it received bids totaling QR5.305bn. T-bills worth QR2bn with a three-month maturity period were auctioned at a yield of 0.73%. T-bills with a six-month maturity period worth QR1bn were sold at a yield of 0.96%, while T-bills with nine-month maturity period worth QR1bn were auctioned at a yield of 1.10%. (QCB)  Qatar state spending up 13% in 2013/14, slowest in 11 years – According to the preliminary finance ministry data released by the central bank, Qatar’s public spending increased 12.7% last fiscal year, the lowest rate in 11 years, as slow growth in current expenditure offset a sharp rise in funds spent on infrastructure. Expenditure rose to a record high of QR231.7bn ($63.6bn) in the year that ended in March, from QR205.6bn in 2012/13. Last year’s spending was 10% more than initially planned. However, the margin by which actual spending overshot the plan was the lowest in five years, suggesting the government has begun to rein in excesses of the previous four years. Project spending soared 32.7% to QR68.4bn in 2013/14, as compared to just 1.9% growth in 2012/13. Current expenditure rose 6.0% to QR163.2bn in 2013/14, a sharp slowdown from a 24.4% jump in each of the previous two years, because of a drop in interest payments and spending on supplies and services. State revenue grew 21.9% to a record QR346.6bn last fiscal year, slower than the 27.8% rise in the previous year. Further, the 2013/14 budget surplus surged to a record QR115.0bn (15.6% of GDP), from QR78.8bn (11.4% of GDP) in the previous year. ( Market & Corporate News  Qatar stock market set to be flooded with more liquidity – Qatar issued a law formally raising the limit of foreign ownership in the listed companies to 49%. The move paves the way for more liquidity flow into the country’s stock market that has a capitalization of $192.21bn. The foreign ownership limit in most listed companies was 25% earlier. Non-Qatari GCC nationals, who were previously treated as foreigners for the purpose of trading in Qatari stocks, are to be now treated as Qatari citizens. This means their ownership of Qatari stocks will not be counted in as being part of foreign ownership. Meanwhile, QNA said the Emir HH Sheikh Tamim bin Hamad Al Thani had issued Law No. 9 of 2014, which amends some provisions of Law No. 13 of 2000 regulating investment of non- Qatari capital in economic activity. The law says that listed companies should seek approval from the Ministry of Economy and Commerce to amend their Articles of Association to raise the foreign ownership limit to 49%. QNA said the legislation also provides for raising this percentage (49) for foreigners further with approval from the State Cabinet. The law is to be effective from the date of issue and is to be published in the official gazette. (Peninsula Qatar)  Qatar set to award projects worth $26.2bn – Qatar will award projects worth $26.2bn in 2014 as compared to $9.4bn in 2013. According to latest figures released by construction intelligence firm Ventures Onsite, the infrastructure project awards across the GCC are forecasted to exceed $86bn in 2014, indicating an increase of 77.8% over 2013. In the UAE, projects worth $15.18bn will be awarded, almost five times more than what was awarded in 2013, while in Oman infrastructure awards are expected to reach $7.4bn. Bahrain, which awarded projects worth $382mn in 2013, is expected to award $3.4bn. Kuwait is expected to award projects worth $3.45bn. Saudi Arabia’s forecasted award of $29.34bn — the highest in the region — represents a YoY decrease. The infrastructure projects make up 16% of the total construction value of GCC projects, and rail projects like the Riyadh Metro are the main beneficiary. According to Ventures, it is estimated that the rail sector is worth $200bn as the six countries aim for an integrated GCC- wide network by 2018. (Reuters)  MERS reports QR112.8mn net profit in 1H2014 – Al-Meera Consumer Goods Company (MERS) reported a net profit of QR112.8mn in 1H2014 as compared to QR57.6mn in 1H2013. The Company’s EPS amounted to QR5.64 in 1H2014 versus QR3.16 in 1H2013. (QE)  QNCD net profit drops QoQ and YoY – Qatar National Cement Company (QNCD) posted a net profit of QR107.9mn in 2Q2014 vs. QR129.9mn in 1Q2014; dropping by 16.9% and 7.7% QoQ and YoY, respectively. EPS stood at QR4.84 as of 1H2014 vs. QR4.80 as of 2H2013. (QE)  ZHCD reports QR100.87mn net profit in 1H2014 – Zad Holding Company (ZHCD) reported a net profit of QR100.87mn in 1H2014 as compared to QR90.39mn in 1H2013. The Company’s EPS amounted to QR4.68 in 1H2014 versus QR4.20 in 1H2013. (QE)  ORDS launches Myanmar telecom network – Ooredoo (ORDS) has launched its telecommunications services in Myanmar. The company will take on two rivals who are also rolling out networks in a country that has only 10% mobile penetration. More than 90 companies and consortia submitted expressions of interest after the government issued a tender for the two licenses in 2013. ORDS’ voice & 3G internet services will initially be available in Myanmar's three main cities of Yangon, Mandalay and the capital, Naypyitaw. The network will cover 25mn of Myanmar's approximately 60mn people by the end of 2014 and 97% of the population within five years. (Reuters)  ORDS’ Myanmar coverage to reach 68 cities by August 15 – Ooredoo’s (ORDS) coverage in Myanmar will rapidly extend beyond the three main cities of Mandalay, Nay Pyi Taw and Yangon to include some 68 cities and towns by August 15. ORDS has announced the availability of its “crystal clear” voice calls and fast internet services in three of Myanmar’s major cities, Mandalay, Nay Pyi Taw and Yangon, as part of the final preparations for the commercial launch later this month. Initially, ORDS will provide free of charge in a kick-off promotion. In another first, not only for Myanmar but globally, Ooredoo is rolling out a next generation, purely UMTS900 network with some of the most advanced 3G technology in the world. The benefits of this technology include a stronger signal, crystal clear sound and fast Internet. (  CBQK appoints new executive general manager – Commercial Bank of Qatar (CBQK) has appointed Mr. Colin Macdonald as Executive General Manager, Business Enablement. Mr. Colin will play a leading role in driving business performance and strategic initiatives, supporting and advising the CEO and the CBQK leadership team. Mr. Colin has wide banking experience, including extensive experience in the Middle East, built over 26 years. (Zawya)
  3. 3. Page 3 of 5 Qatar Exchange Top 5 Gainers Top 5 Decliners Source: Qatar Exchange (QE) Source: Qatar Exchange (QE) Most Active Shares by Value (QR Million) Most Active Shares by Volume (Million) Source: Qatar Exchange (QE) Source: Qatar Exchange (QE) Investor Trading Percentage to Total Value Traded Net Traded Value by Nationality (QR Million) Source: Qatar Exchange (QE) Source: Qatar Exchange (QE) 19.8% 14.2% 14.1% 10.2% 9.7% 0.0% 7.0% 14.0% 21.0% Mazaya Qatar Islamic Holding Group Medicare Group Qatari Investors Group Qatar Cinema & Film Distribution -2.2% -1.8% -1.5% -1.1% -0.8% -3.0% -2.0% -1.0% 0.0% Industries Qatar Ezdan Real Estate Commercial Bank of Qatar Al Khaliji Mesaieed Petrochemical Holding Company 402.6 294.6 224.2 214.8 164.6 0.0 150.0 300.0 450.0 Mazaya Qatar United Development Industries Qatar Masraf Al Rayan Qatar Islamic Bank 19.4 10.1 7.3 6.3 5.1 0.0 7.0 14.0 21.0 Mazaya Qatar United Development Ezdan Real Estate Salam International Investment Qatar & Oman Investment 0% 20% 40% 60% 80% 100% Buy Sell 45.07% 47.39% 17.23% 19.11% 13.98% 14.02% 23.73% 19.48% Qatari Individuals Qatari Institutions Non-Qatari Individuals Non-Qatari Institutions 2,098 1,270 2,240 1,128 (141) 142 (500) - 500 1,000 1,500 2,000 2,500 Qatari Non-Qatari Net Investment Total Sold Total Bought
  4. 4. Page 4 of 5 TECHNICAL ANALYSIS OF THE QE INDEX Source: Bloomberg The QE Index ended the volatile week on a bullish note. The index started the week on a bearish note, but witnessed a strong comeback registering gains on Monday and Tuesday, which helped it to reclaim the 13,000.0 psychological level. However, the rally was short-lived as the index shed majority of its gains on Wednesday and Thursday on the back of profit-booking. Meanwhile, the index faces its stiff resistance near the 13,200.0 level. Traders should watch out for a move above this level as it may cover all the short positions and push the index higher toward the 13,350.0-13,400.0 levels. However, any failure to move above 13,200.0 may result in a range-bound movement. On the downside, the index has immediate support near the 13,000.0 psychological level. Any sustained weakness below this level may drag the index to test 12,900.0. Bulls should worry only if this level is taken off, as it may result in a sell- off and pull the index down toward the 12,770.0-12,800.0 levels. As of now, both the momentum indicators are stalling, indicating lack of clarity in the direction of the index. Thus, traders are advised to exercise caution and build their positions only when the index is able to breach the key mentioned levels. 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.
  5. 5. Contacts Saugata Sarkar Abdullah Amin, CFA Shahan Keushgerian Head of Research Senior Research Analyst Senior Research Analyst Tel: (+974) 4476 6534 Tel: (+974) 4476 6569 Tel: (+974) 4476 6509 Sahbi Kasraoui Ahmed Al-Khoudary QNB Financial Services SPC Manager – HNWI Head of Sales Trading – Institutional Contact Center: (+974) 4476 6666 Tel: (+974) 4476 6544 Tel: (+974) 4476 6548 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 Source: Bloomberg Com pany Nam e Price (August 07) % Change 5-Day % Change YTD Market Cap. QR Million TTM P/E P/B Div. Yield Qatar National Bank 181.40 0.22 5.47 126,931 12.9 2.4 3.9 Qatar Islamic Bank 109.20 3.31 58.26 25,803 18.2 2.2 3.7 Commercial Bank of Qatar 67.00 (1.47) 13.56 19,895 12.4 1.2 2.5 Doha Bank 57.00 1.24 (2.06) 14,727 10.3 1.3 7.9 Al Ahli Bank 52.80 1.34 24.80 8,722 15.6 2.2 N/A Qatar International Islamic Bank 84.40 1.20 36.79 12,776 16.2 2.5 4.4 Masraf Al Rayan 53.80 1.13 71.88 40,350 22.6 3.9 2.8 Al Khaliji Bank 22.25 (1.11) 11.31 8,010 15.4 1.4 4.5 National Leasing 28.80 1.77 (4.48) 1,425 22.7 1.1 5.2 Dlala Holding 58.50 8.33 164.71 1,299 16.5 4.8 N/A Qatar & Oman Investment 15.78 4.57 26.04 497 20.2 1.5 3.8 Islamic Holding Group 79.00 14.16 71.74 316 26.0 5.3 2.2 Banking and Financial Services 260,751 Zad Holding 87.00 6.88 25.18 1,138 10.6 0.8 4.0 Qatar German Co. for Medical Devices 14.10 3.30 1.81 163 N/M 0.9 N/A Salam International Investment 20.10 6.86 54.50 2,298 16.0 1.4 5.0 Medicare Group 118.70 14.13 126.10 3,341 26.7 4.1 1.5 Qatar Cinema & Film Distribution 51.00 9.68 27.18 291 25.3 2.1 N/A Qatar Fuel 219.80 2.09 0.58 18,564 15.6 3.0 3.5 Qatar Meat and Livestock 57.70 6.85 11.61 1,039 19.4 3.9 3.6 Al Meera Consumer Goods 192.00 5.67 44.04 3,840 14.9 3.0 4.2 Consum er Goods and Services 30,673 Qatar Industrial Manufacturing 46.20 0.43 9.57 2,195 10.9 1.5 N/A Qatar National Cement 136.40 1.87 14.62 6,697 15.3 2.8 4.4 Industries Qatar 169.60 (2.19) 0.41 102,608 14.6 3.6 6.5 Qatari Investors Group 56.40 10.16 29.06 7,012 30.7 3.2 1.3 Qatar Electricity and Water 184.50 0.99 11.57 20,295 13.9 3.4 3.7 Mannai Corp. 114.30 3.91 27.14 5,214 10.3 2.9 4.8 Aamal 16.23 0.25 8.20 9,738 18.3 1.4 N/A Gulf International Services 117.30 2.89 140.37 21,799 25.7 6.7 1.4 Mesaieed Petrochemical Holding 32.65 (0.76) N/A 41,019 N/A 3.0 1.1 Industrials 216,578 Qatar Insurance 92.00 2.22 72.93 14,770 15.1 2.8 2.2 Doha Insurance 29.50 9.26 18.00 1,475 10.2 1.5 6.8 Qatar General Insurance & Reinsurance 46.00 2.22 15.24 3,182 2.2 0.7 2.7 Al Khaleej Takaful Insurance 45.35 0.11 61.52 1,007 11.8 1.5 N/A Qatar Islamic Insurance 84.30 0.36 45.60 1,265 15.1 4.9 4.4 Insurance 21,698 United Development 30.00 5.63 39.32 10,623 21.4 1.0 3.2 Barw a Real Estate 39.05 3.58 31.04 15,195 11.7 1.1 5.1 Ezdan Real Estate 19.90 (1.78) 17.06 52,785 40.9 1.8 1.6 Mazaya Qatar Real Estate Development 22.04 19.78 97.14 2,204 14.3 1.8 3.4 Real Estate 80,807 Qatar Telecom 128.80 0.63 (6.12) 41,257 16.5 1.6 3.1 Vodafone Qatar 19.78 3.56 84.69 16,722 N/M 2.9 0.9 Telecom s 57,979 Qatar Navigation (Milaha) 93.90 4.68 13.13 10,754 11.9 0.9 5.3 Gulf Warehousing 50.00 2.04 20.48 2,378 20.3 3.0 3.0 Qatar Gas Transport (Nakilat) 24.90 4.62 22.96 13,944 16.9 3.8 4.4 Transportation 27,076 Qatar Exchange 695,562