Rising geopolitical tensions and the US pullout from Iran nuclear deal had their reflections in the Qatar Stock Exchange, which saw more than QR6bn loss in capitalisation this week.
Led by insurance, banking, real estate, industrials and consumer goods sectors, the Qatari equity market fell below 8,800 levels this week which saw Qatar Petroleum’s announcement to offload 49% stake in Qatalum through an initial public offering that is expected to hit the market by the end of this year.
The huge gains in the initial two days was masked by profit-booking in the later part of the week which saw Amwal view Qatalum maiden offer as positive for the market and has the potential to bring depth and diversity.
More than 61% of the traded constituents were in the red this week which saw no trading of sovereign bonds and treasury bills.
Foreign funds’ increased net selling and lower buying support from local retail investors were seen dragging the 20-stock Qatar Index 0.64% this week which however saw small and microcap equities extend gains.
"The US' withdrawal from the Iran nuclear deal is likely to further increase geopolitical risk in the Middle East. However, the full impact depends on the severity of US sanctions snapback and the responses from Iran, the other parties to the deal, and major regional powers," Fitch, a global credit rating agency, said.
Notwithstanding the overall bearish overhang, domestic institutions turned bullish and there was increased net buying from non-Qatari individuals this week.
However, on a year-to-date basis, the bourse's benchmark showed about 3% rise mainly on robust demand for consumer goods, industrials and banking sectors, whose indices were up in double digits. Large and midcap scrips also performed well on a yearly basis.
The market witnessed a total volume of 0.3mn QATR (Masraf Al Rayan sponsored exchange traded fund or ETF) valued at QR6.7mn trade across 339 transactions and as many as 0.03mn QETF (Doha Bank sponsored ETF) valued at QR2.84mn change hands across 55 deals this week.
The Total Return Index shed 0.64%, All Share Index 1.2% and Al Rayan Islamic Index (Price) 0.65% this week.
The insurance index plummeted 3.18%, banks and financial services (1.53%), realty (1.32%), industrials (1.08%) and consumer goods (1.02%); whereas transport and telecom gained 1.53% and 0.4% respectively this week which saw Qatar Insurance (QIC) and Vodafone Qatar dominated trading ring in volumes and value.
Major shakers included Aamal Company, Qatari Investors Group, QIC, Doha Insurance, Qatar Oman Investment, Ooredoo, Mesaieed Petrochemical Holding, QNB, Qatar Islamic Bank, Mazaya Qatar, Barwa and Ezdan this week.
Nevertheless, Dlala, Islamic Holding Group, Ahlibank, Zad Holding, Vodafone Qatar, Milaha, Gulf Warehousing, Qatar Electricity and Water and Commercial Bank were among the gainers this week which saw telecom, industrials and banking sectors together accounted for about 82% of total trade volumes.
The telecom sector accounted for 39% of the total trading volume, industrials (23%), banks and financial services (20%), real estate (8%), transport (5%), consumer goods (4%) and insurance (2%) this week.
The banks and financial sector’s share in total trade turnover was 29%, industrials and telecom (24% each), consumer goods (10%), realty (6%), transport (4%) and insurance (3%) this week.
Non-Qatari institutions’ net profit booking increased to QR30.56mn against QR24.29% the week ended May 3.
Local retail investors’ net buying weakened substantially to QR17.77mn compared to QR27.86mn a week ago.
However, domestic funds turned net buyers to the tune of QR7.03mn against net sellers of QR4.69mn the previous week.
Non-Qatari individuals’ net buying strengthened perceptibly to QR5.86mn compared to QR1.11mn the week ended May 3.
Total trade volume fell 5% to 48.48mn shares, value by 21% to QR974.26mn and transactions by 9% to 16,603.
The market witnessed 58% plunge in the transport sector’s trade volume to 2.36mn equities, 59% in value to QR39.55mn and 36% in deals to 1,232.
The industrials sector’s trade volume plummeted 45% to 10.93mn stocks, value by 46% to QR232.93mn and transactions by 15% to 3,654.
There was 41% shrinkage in the real estate sector’s trade volume to 3.78mn shares, 31% in value to QR54.4mn and 21% in deals to 1,805.
The consumer goods sector’s trade volume declined 4% to 1.71mn equities, value by 42% to QR101.58mn and transactions by 27% to 1,605.
However, the telecom sector’s trade volume more than doubled to 19.13mn stocks, value soared 66% to QR232.35mn and deals by 30% to 2,952.
The insurance sector reported 67% surge in trade volume to 0.9mn shares, 44% in value to QR26.37mn and 14% in transactions to 605.
The banks and financial services sector’s trade volume grew 28% to 9.67mn shares, even as value was down 2% to QR287.08mn despite 1% higher deals at 4,750.
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