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The Qatar Stock Exchange Tuesday gained more than 75 points, mainly paced by the consumer goods and industrials sectors. The foreign institutions’ increased net buying drove the 20-stock Qatar Index up 0.59% to 12,936.54 points, recovering from an intraday low of 12,937 points. The Arab retail investors were net buyers, albeit at lower levels, in the market, whose year-to-date gains improved to 11.27%. About 61% of the traded constituents extended gains in the bourse, whose capitalisation added QR3.06bn or 0.43% to QR715.66bn, mainly on the back of small and microcap segments. The Islamic index gained faster than the other indices in the market, which saw a total of 0.03mn exchange traded funds (sponsored by Masraf Al Rayan and Doha Bank) valued at QR0.36mn changed hands across 20 deals. Trade turnover and volume were on the increase in the main market; while it showed a decrease in the case of venture market. However, the local retail investors were increasingly bearish in the bourse, which saw no trading of sovereign bonds. The domestic institutions were seen net profit takers in the market, which saw no trading of treasury bills. The Total Return Index gained 0.59% to 26,498.23 points, the All Share Index by 0.44% to 4,107.32 points and the Al Rayan Islamic Index (Price) by 0.8% to 2,834.33 points. The consumer goods and services sector index shot up 1.54%, industrials (0.9%), real estate (0.51%), insurance (0.44%), transport (0.31%), banks and financial sector (0.14%) and telecom (0.13%). The major gainers in the main market included QLM, Mannai Corporation, Medicare Group, Woqod, Milaha, Masraf Al Rayan and Ezdan. Nevertheless, Aamal Company, Doha Insurance, Estithmar Holding, Alijarah Holding, Qatar Electricity and Water, QNB and Nakilat were among the losers in the main market. In the venture market, both Al Faleh Educational Holding and Mekdam Holding saw their shares depreciate in value. The foreign institutions’ net buying increased significantly to QR130.83mn compared to QR4.18mn on September 19. The Arab individuals turned net buyers to the tune of QR0.58mn against net sellers of QR2.84mn the previous day. However, the local retail investors’ net selling expanded substantially to QR110.03mn compared to QR19.62mn on Monday. The domestic institutions were net sellers to the extent of QR14.18mn against net buyers of QR14.02mn on September 19. The Gulf institutions turned net sellers to the tune of QR7.89mn compared with net buyers of QR2.3mn the previous day. The Gulf retail investors were net sellers to the extent of QR1.4mn against net buyers of QR1.97mn on Monday. The foreign individuals turned net profit takers to the tune of QR0.35mn compared with net buyers of QR5.05mn on September 19. The Arab institutions’ net buying weakened noticeably to QR2.44mn against QR3.32mn the previous day. Total trade volume in the main market soared 16% to 138.5mn shares, value by 29% to QR540.3mn and deals by 16% to 16,886. The venture market saw 10% shrinkage in trade volumes to 0.26mn equities, 35% in value to QR1.34mn and 12% in transactions to 115.

The FIFA World Cup will help Qatar’s revenues from global tourism to grow more than 116% year-on-year to QR67bn in 2022, according to the Minister of Commerce and Industry HE Sheikh Mohamed bin Hamad bin Qassim al-Thani. “It is estimated that the FIFA World Cup will attract more than 1mn visitors, thus leading to projected international tourism revenues of QR67bn in 2022 compared to QR31bn in 2021,” the minister said in an interview to The Business Year’s World Cup special edition, which was unveiled yesterday. The projects implemented within the framework of organising and hosting the FIFA World Cup support the state’s journey towards achieving its strategic and development goals in the coming years, he said, adding the hosting of the FIFA World Cup has had a vital, significant role in promoting economic growth and diversification in the nation. Since the beginning of this journey, Qatar has been keen to launch initiatives that support the urban planning and economic diversification sectors, he said. “This global event will contribute positively to Qatar’s economic landscape by attracting investments and ensuring the economic growth of a number of vital sectors such as trade and tourism, as well as promoting the expansion of sports’ contribution to the economic sector,” according to him. As part of strengthening the diversification strategy, the Ministry of Commerce and Industry is also working on strategies to provide “significant” incentives to enhance investments in the manufacturing sector, HE Sheikh Mohamed highlighted. “The Ministry of Commerce and Industry seeks to diversify income sources and increase the real value added from priority sectors, especially non-oil ones, as well as raise Qatar’s non-oil exports in 2022,” he said. The ministry is currently working to remove all obstacles to Qatar’s business environment and to develop it further as well as provide significant incentives to enhance investment in the manufacturing sector, whose share in gross domestic product (GDP) has increased to about 66% by the end of 2020 compared to 52% in 2018. “Additionally, the ministry seeks consolidating the role of the private sector in achieving the economic prosperity of Qatar,” he said. Highlighting that the manufacturing sector was among the fastest to recover, he said based on these positive indications, “we expect the manufacturing sector’s growth and momentum to be sustained in the coming years.” As part of its efforts to support the industrial sector and enhance its contribution to the national economy, the ministry created Qatar’s manufacturing sector strategy (2018-22) to layout a roadmap for the manufacturing industries up until 2030. In this regard, he cited the government’s efforts to attract major international companies to Qatar to invest in “strategic” manufacturing sub-sectors such as plastics products, 3D printing, pharmaceuticals and extreme environment infrastructure solutions.

Qatar is expected to experience “significant” momentum and growth after the 2022 FIFA World Cup and the country’s status as a global sports hub will be a driver for new business opportunities for the private sector, according to QNB Group chief executive officer Abdulla Mubarak al-Khalifa. “We expect to see a surge of business as this event (FIFA World Cup) will benefit the economy long beyond the closing match, attracting foreign direct investment (FDI), while at the same time developing domestic entrepreneurship,” he said in an interview to The Business Year’s (TBY) World Cup special edition. TBY has been covering the Qatari economy for almost a decade and this latest publication was produced in partnership with the Ministry of Commerce and Industry, the Qatari Businessmen Association, and the Qatari Businesswomen Association. Qatar’s status as a global sport hub will be a driver for the private sector, though “we also expect to see strong growth in new projects beyond sport that will benefit the economy,” the minister said. “Strengthening of regulatory frameworks is paving the way for public-private-partnership (PPP) projects, particularly in the education, healthcare and tourism sector,” he said, adding “as the leading incubator for private sector engagement, we act as a one-stop shop for the small and medium enterprises (SMEs).” Referring to its partnership with FIFA on being the official Middle East and Africa supporter, he said, “This (partnership) will strengthen QNB’s brand image and reputation globally.” The bank seeks to leverage innovation as a strategic enabler for both corporate and personal clients, he said, adding changes in the customer behaviour has led to a shift to more convenient and remote channels. “This trend has accelerated our drive towards digitalisation and automation, which ultimately impacts our business and operating model. Those trends are further exacerbated by the entry of new players such as non-banks, non-financial institutions, fintechs and bigtechs and results in disruption through technological innovation and financial intermediation,” al-Khalifa said. QNB Group extends through its subsidiaries and associate companies to more than 31 countries across three continents providing a comprehensive range of products and services. The total number of employees is 27,000 operating through 1,000 locations, with an ATM network of more than 4,500 machines.

Accessing funds through Islamic debt is slated to taper off in the Gulf Cooperation Council (GCC) in the second half of this year as fiscal surpluses across the region will limit the new sovereign issuance, according to Moody's, an international credit rating agency. "We do not expect the GCC's strong performance in the first half of the year to continue into the second half," Ashraf Madani, vice president, senior credit officer, told a recent media roundtable. Stronger than expected issuance activity from the GCC sovereigns offset a drop in issuance in Southeast Asia and Turkiye, Moody's said, disclosing that the issuance reached $92bn in the first six months of 2022, down from $102bn in the same period of 2021. The GCC sukuk issuance grew 27% to $44bn in the first half of 2022, largely supported by Saudi Arabia; it said, adding the finances of GCC governments are strongly correlated to oil price movements because of their high dependence on hydrocarbon revenues. Elevated uncertainty surrounding the global growth outlook and rising interest rates played a key role in the significant drop in sukuk activity from GCC corporate and financial institutions. Many non-sovereign issuers, which are more sensitive to long-term volatility in rates, have postponed planned issuance or decided to seek alternative funding sources. As a result, sukuk volumes from the GCC corporates and financial institutions fell to $3bn in the first half of 2022 from $14bn in the same period in 2021. Moody's expected the GCC issuance to fall in the second half of the year as high oil prices have lowered the gross financing requirements of oil-exporting countries. "We expect global sukuk issuance to decline in 2022, with issuance volume ranging between $160bn and $170bn, down from $181bn in 2021," he said, adding this follows a record volume of $205bn in 2020 after five years of consecutive growth. "The improved fiscal position of major sovereign issuers remains the key contributor to the expected drop in volumes this year. In the GCC, high oil prices are reducing governments' financing needs, while in Southeast Asia we expect lower government expenditure because of a decline in pandemic-related spending to reduce governments’ fiscal deficits," the rating agency said. Higher interest rates will maintain pressure on issuance activity, particularly by corporates and financial institutions, which are more sensitive to changes in interest rates. Some issuers have deferred their access to the sukuk market as a result of volatility in long-term interest rates in the first half of 2022. "We expect this situation to persist into the second half of the year as major central banks continue to raise rates to combat inflation," the analyst said. Nonetheless, sukuk’ appeal and acceptance as an investment tool is growing, as shown by high demand for recent issuances. It has become normal for order books to exceed the offered amount by three or four times, particularly for creditworthy borrowers. Furthermore, demand for sukuk is increasingly coming from international actors in markets less exposed to Islamic finance.

Qatar's cost of living, based on the consumer price under (CPI) inflation, grew 4.8% on an annualised basis in August, according to official data. The increase in the country's general price level comes amidst an overall inflationary pressure in the global economy, which prompted the central banks to tighten their monetary policies. On a month-to-month basis, Qatar's inflation was up 0.13% in the review period, according to the Planning and Statistics Authority (PSA). Qatar's core inflation (excluding housing and utilities) rather followed a similar trend with it rising 3.89% year-on-year even as it fell 0.46% month-on-month in August 2022. Both Finance Minister HE Ali bin Ahmed al-Kuwari and the Qatar Central Bank Governor HE Sheikh Bandar bin Mohamed bin Saoud al-Thani had affirmed at the Qatar Economic Forum, powered by Bloomberg, that the country has enough tools to contain inflation. The index of recreation and culture, which has an 11.13% weight in the CPI basket, zoomed 27.88% year-on-year but tanked 4.33% on monthly basis in August this year. The entertainment sector has been witnessing steady increase on an annualised basis, as the country relaxed the restrictions related to the Covid-19 pandemic. The index of housing, water, electricity and other fuels – with a weight of 21.17% in the CPI basket – saw 8.75% and 2.61% surge on yearly and monthly basis respectively in August 2022. The food and beverages group, with a weight of 13.45% in the CPI basket, witnessed 5.77% and 2.16% growth year-on-year and month-on-month respectively this August. The index of clothing and footwear, which has a 5.58% weight in the CPI basket, was seen expanding 2.24% and 0.43% year-on-year and month-on-month respectively in August 2022. The restaurants and hotels group, with a 6.61% weight, saw its index gain 1.49% on a yearly basis but was down 0.19% month-on-month this August. In the case of furniture and household equipment, which has a 7.88% weight in the CPI basket, the index rose 1.39% year-on-year but was down 0.09% month-on-month in August this year. The miscellaneous goods and services, with a 5.65% weight, saw its index jump 0.36% and 0.11% year-on-year and month-on-month respectively in the review period. Education, with a 5.78% weight, saw its index gain 0.31% and 0.05% on yearly and monthly basis respectively in August 2022. However, the index of health, which has a 2.65% weight, was seen plummeting 3.38% on a yearly basis, although it was unchanged month-on-month in August 2022. The index of transport, which has a 14.59% weight, was seen shrinking 3.2% and 1% year-on-year and month-on-month respectively in August 2022. The sector has the direct linkage to the dismantling of the administered prices in petrol and diesel as part of the government measures to lower the subsidies. In August 2022, the retail price of super, premium gasoline and diesel witnessed a 13.51%, 5.41% and 17.14% surge year-on-year respectively. On a monthly basis, the price of super and diesel was flat; while that of premium declined 25%. Communication, which carries a 5.23% weight, saw its group index shrink 1.24% on a yearly basis. It was flat month-on-month respectively in the review period. The tobacco index, which has a 0.28% weight, was unchanged on yearly and monthly basis in the review period.    

The Qatar Stock Exchange gained about 300 points and capitalisation added QR15bn this week, notwithstanding global apprehensions over sharp US interest rate hike. The banking and telecom counters witnessed higher than average demand as the 20-stock Qatar Index vaulted 2.28% this week, which saw global credit rating agency Moody’s view that Qatar and Oman are among the Gulf countries to benefit the most from the high oil prices. The foreign institutions were increasingly net buyers this week, which saw Moody’s senior analyst Nitish Bhojnagarwala opine that Qatar’s banks are expected to improve the bottom-line this year. More than 53% of the traded constituents extended gains to investors this week, which saw the bourse report that Qatar Insurance Company will replace Salam International Investment in the main barometer, effective from October 1. The Gulf institutions were seen bullish, albeit at lower levels, this week, which saw Qatar’s consumer price index inflation jump 4.8% on an annualised basis this August. However, the domestic funds were increasingly net sellers this week, which saw Qatar Central Bank Governor HE Sheikh Bandar bin Mohamed bin Saoud al-Thani disclose that the country’s Islamic banks’ asset amount to $154bn at the end of June 30, 2022. The local retail investors’ net selling grew considerably this week, which saw a total of 0.23mn Masraf Al Rayan-sponsored exchange traded fund QATR worth QR0.64mn trade across 41 deals. The Gulf funds turned net profit takers this week, which saw as many as 0.2mn Doha Bank-sponsored QETF valued at QR2.53mn change hands across 83 transactions. The overall trading turnover and volumes were on the increase in the main market and similar was the trend in the venture market this week, which saw the industrials and banking sectors together constitute about 57% of the total trade volume in the main market. Market capitalisation gained QR14.89bn or 2.07% to QR734.34bn, mainly on large and midcap segments this week, which saw no trading of sovereign bonds. The Total Return Index zoomed 2.28%, the All Share Index by 2.47% and the All Islamic Index by 0.85% this week, which saw no trading of treasury bills. The banks and financial services sector index shot up 4.71%, telecom (3.76%), real estate (0.85%), insurance (0.77%) and industry (0.37%); while transport declined 3.18% and consumer goods and services 1.13% this week. Major gainers in the main market included Qatar Islamic Bank, QNB, Ooredoo, Commercial Bank, QLM, Alijarah Holding, Inma Holding, Qatari German Medical Devices, Medicare Group, Qatar Electricity and Water and United Development Company. In the venture market, Mekdam Holding saw its shares appreciate in value this week. Nevertheless, Mannai Corporation, Qatar Cinema and Film Distribution, Milaha, Widam Food, Ezdan, Doha Bank, Qatar National Cement, Estithmar Holding and Nakilat were among the losers in the main market. In the junior bourse, Al Faleh Educational Holding saw its shares depreciate in value. The foreign funds’ net buying increased significantly to QR539.44mn compared to QR120.91mn the week ended September 8. The Arab institutions turned net buyers to the tune of QR0.67mn against net sellers of QR0.37mn the previous week. However, the domestic institutions’ net selling grew substantially to QR377.57mn compared to QR88.06mn a week ago. The local retail investors’ net selling expanded drastically to QR138.37mn against QR58.05mn the week ended September 8. The Gulf institutions were net profit takers to the extent of QR21.54mn. The Gulf individuals turned net sellers to the tune of QR7.66mn compared with net buyers of QR24.65mn a week ago. The Arab individuals’ net buying decreased markedly to QR3.78mn against QR17.27mn the week ended September 8. The foreign individuals’ net buying weakened perceptibly to QR1.26mn compared to QR4.78mn the previous week. Total trade volume in the main market soared 12% to 760.34mn shares and value by 35% to QR3.4bn; whereas deals were down 8% to 84,778. The venture market reported a 3% jump in trade volumes to 1.16mn stocks, 19% in value to QR8.27mn and 9% in transactions to 443.    

Qatar Fintech Hub (QFTH), which is the second largest investor in Middle East and North Africa (Mena) in fintech, has incubated more than 60 entities with valuation in excess of $400mn, according to the Qatar Development Bank (QDB), which is the founder of QFTH. The QDB is now contemplating to launch green financing products for the small and medium enterprises (SMEs), its chief executive officer Abdulrahman bin Hisham al-Sowaidi told the Islamic Financial Services Board (IFSB) Innovation Forum, which was held yesterday in association with the Qatar Financial Centre (QFC) and the Qatar Central Bank (QCB). Addressing one of the panel discussions ‘The future of Fintech and its role in the wider ESG ecosystem,’ he said even before the start of (Qatar) fintech hub or QFTH, the development institution had helped start a lot of verticals from innovation aspects starting from manufacturing, to sport clusters. Highlighting that through QFTH, it has combined the initiatives of QDB, QFC and QCB; he said it was basically to foster the innovation and it has so far received more than 2,300 applications from more than 70 countries. “We have incubated more than 60 companies across waves,” he said, adding the valuation of these entities has reached more than $400mn. Terming that the country’s fintech strategy has demonstrated the success; al-Sowaidi said QFTH has now been recognised within the global fintech industry. Quoting a report from MAGNiTT, a startups research and intelligence firm, he said QFTH was ranked as the second top investor in fintechs across the Mena region in the first quarter of 2021. Recently Masraf Al Rayan developed a Green deposit in association with QDB. The green deposit is a unique alternative investment solution that allows riyal deposits and other major currencies to be deployed for funding green initiatives. “Just down the road, we can announce, hopefully after getting the approvals, the first green financing product for the SMEs,” he said, without disclosing further details. Highlighting that a lot of environmental friendly products from advisory aspects will also be provided to SMEs; he said “we are not only targeting Green-field projects but also Brown-field projects to help them transform into green element.” Earlier in a special address, QFC Authority chief executive officer Yousuf Mohamed al-Jaida said the outlook of Islamic finance points to strong future growth. “If performed exceedingly well in the last decade. Today, global Islamic finance industry worth is over $2tn and projected to grow to $5bn by 2025,” he said.    

Qatar, whose Islamic banking assets reached $154bn as on June this year, is now in the top five destinations in the global Islamic finance industry, according to a top official of the Qatar Central Bank (QCB). Addressing the fourth IFSB (Islamic Financial Services Board) Innovation forum, QCB Governor HE Sheikh Bandar bin Mohamed bin Saoud al-Thani said Qatar operates a dual banking system with four Islamic banks and has 28% of the banking assets held by Islamic banks. Quoting 2021 IFSB’s IFSI Stability Report, he said Islamic banking is currently operating in at least 39 jurisdictions, of which it has attained “systemic importance” in 15 jurisdictions, including in Qatar. “With 6.5% of worldwide Islamic banking assets, Qatar is now on the top five destinations in the Islamic finance industry by establishing prudent supervisory and regulatory polices consistent with relevant international standards,” Sheikh Bandar said. Highlighting that the QCB has been playing a prominent role in the country’s financial technology ecosystem; he said “with no one-size fits-all approach to digital transformation; we take a systematic and gradual approach.” With the FIFA World Cup round the corner, the QCB has taken multiple initiatives to ensure safe, quick and affordable digital payments by fostering an ecosystem, he said, in an apparent reference to its latest project to strengthen the payment system. “QCB has begun multi-year strategic initiatives to modernise the prudential architecture for digitalisation and fintech,” Sheikh Bandar said. The project to strengthen the infrastructure for payment and settlement system offers several features such as instant transfers and interoperability between a bank account and digital wallet as well as providing a scalable future payment system, capable of supporting the population growth in Qatar and increasing number of transactions for the next 10 years. In this regard, he said the QCB has issued its first licence for digital payments services to iPay by Vodafone Qatar and Ooredoo Money. The QCB recently disclosed the banks' readiness to launch Google Pay and that all global digital wallet services for cards, such as Apple Pay and Samsung Pay, are now accepted in Qatar, which will enable visitors, especially during the FIFA World Cup Qatar 2022, to process and complete their digital payments. Finding that Qatari lenders have already embarked on green banking and that they are also voluntarily integrating ESG (environment, social and governance) risk analysis into their credit profile and assessment process for corporate clients; he said these are important turning points towards developing a more cohesive and sustainable framework. Sheikh Bandar said recently digital transformation and climate change have captured the attention of the real economy as well as financial and private sectors. These two developments are transforming the role of the central banks and the financial services industry into digital acceleration and innovation, according to him. “As a general principle, these two policies fall under the Qatar National Vision 2030, which focuses on achieving a secure cashless society, which enhance financial inclusion as well as captivating sustainable green economy,” he said.    

Qatar Insurance will replace Salam International in the Qatar Stock Exchange's (QSE) main barometer QE Index, effective October 1. Aamal will be removed from the QE Al Rayan Islamic Index. Under the new index practices, a review is carried out twice a year to ensure that the selection and weighting of the constituents continues to reflect the purpose of the index. The other constituents of the main barometer will remain Industries Qatar, QNB, Qatar Islamic Bank, Masraf Al Rayan, Commercial Bank, Doha Bank, Milaha, Woqod, QIIB, Nakilat, Qatar Electricity and Water, Mesaieed Petrochemical Holding, Ooredoo, Barwa, Qamco, Gulf International Services, Ezdan, Baladna and Investment Holding Group. All listed companies are ranked by giving free float market capitalisation with a 50% weight and average daily value traded also 50% weight. Companies with velocity less than 5% are excluded from the review, as are entities whereby a single shareholder can only own less than 1% of outstanding shares. A 15% cap is applied to an individual constituent's weight in the index, with the excess weight distributed proportionately among the remaining index constituents. In such cases, the fixing of shares figures takes place only at rebalance dates. The index free-float for a stock is total outstanding shares minus shares directly owned by government and its affiliates, those held by founders and board members and shareholdings above 10% or greater of the total outstanding (except those held by those held by pension funds in the country). The other constituents of the Al Rayan Islamic Index are Masraf Al Rayan, Qatar Islamic Bank, Industries Qatar, Milaha, Woqod, Ooredoo, Mesaieed Petrochemical Holding, QIIB, Barwa, Qatar Electricity and Water, United Development Company, Qamco, Vodafone Qatar, Ezdan, Al Meera Consumer Goods, Baladna, Qatar National Cement, Medicare Group, Qatari Investors Group, Gulf Warehousing, Investment Holding Group and Qatar Industrial Manufacturing. In the latest communique, the QSE also said Ahli Bank will join QE All Share Index and QE Banks and Financial Services Sector Index, while Qatar General Insurance and Reinsurance will be removed from QE All Share Index and QE Insurance Sector Index. The bourse has seven sectors – banks and financial services (with 12 constituents), insurance (six), industrials (10), real estate (four), telecom (two), transportation (three) and consumer goods and services (10) in the ‘All Share Index’.    

The Qatar Stock Exchange gained more than 120 points and its key index surpassed 13,300 levels, reflecting the optimism in the global market due to the rising oil prices. The banks, insurance and telecom counters witnessed higher than average demand as the 20-stock Qatar Index shot up 0.91% to 13,314.96 points, recovering from an intraday low of 13,205 points. The foreign institutions were increasingly net buyers in the market, whose year-to-date gains were at 14.53%. The Arab individuals were also increasingly bullish in the bourse, whose capitalisation soared QR7.69bn or 1.05% to QR740.95bn, mainly on the back of mid and small cap segments. The Islamic index was seen gaining slower than the other indices in the market, which saw a total of 0.04mn exchange traded funds (sponsored by Masraf Al Rayan and Doha Bank) valued at QR0.47mn changed hands across 14 deals. Trade turnover and volume were on the increase in the main market and it was a similar trend in the venture market. The Gulf institutions turned net buyers in the bourse, which saw no trading of sovereign bonds. The local retail investors were nevertheless bearish in the market, which saw no trading of treasury bills. The Total Return Index gained 0.91% to 27,237.35 points, the All Share Index by 1.15% to 4,229.78 points and the Al Rayan Islamic Index (Price) by 0.17% to 2,916.3 points. The banks and financial services sector index zoomed 2.2%, insurance (1.18%), telecom (0.79%), consumer goods and services (0.15%) and industrials (0.05%); while transport and real estate declined 1.69% and 0.09% respectively. More than 52% of the traded constituents in the main market extended gains with major movers being Alijarah Holding, Inma Holding, QNB, Qatar Islamic Bank, Al Khaleej Takaful, Dlala, Qatar National Cement, Gulf International Services, Qamco, Qatar Insurance, Mazaya Qatar and Ooredoo. In the venture market, Mekdam Holding saw its shares appreciate in value. Nevertheless, Milaha, Ezdan, Mannai Corporation, Ahlibank Qatar, QLM, Industries Qatar and Nakilat were among the losers in the main market. In the junior bourse, Al Faleh Educational Holding saw its shares depreciate in value. The foreign institutions’ net buying increased significantly to QR242.39mn compared to QR55.91mn on September 12. The Arab individuals’ net buying strengthened perceptibly to QR4.96mn against QR3.23mn the previous day. The Gulf institutions were net buyers to the tune of QR1.29mn compared with net sellers of QR13.14mn on Monday. The Gulf retail investors’ net selling declined noticeably to QR1.12mn against QR7.49mn on September 12. However, Qatari individuals’ net selling grew considerably to QR124.91mn compared to QR17.07mn the previous day. The domestic institutions’ net profit booking rose substantially to QR123.06mn against QR22.25mn on Monday. The foreign individuals’ net buying eased marginally to QR0.47mn compared to QR0.81mn on September 12. The Arab institutions continued to have no major net exposure for the seventh consecutive session. Total trade volume in the main market was up 7% to 149.11mn shares and value by 19% to QR638.22mn, whereas deals shrank 4% to 18,298. The venture market saw trade volumes more than double to 0.2mn equities and value also more than double to QR1.5mn on 88% expansion in transactions to 105.    

Qatar and Oman are the among the Gulf countries to benefit the most from high oil prices, which will buttress balance sheets, according to a top official of Moody's. "Sovereigns most sensitive to oil price fluctuations and with elevated debt burdens could see the most significant improvements in their fiscal and economic strength, exerting upward pressure on their credit profiles. Among those, Oman and Qatar stand to benefit the most," Alexander Perjessy, vice-president, senior credit officer, Moody's yesterday told a media roundtable. The rating agency said elevated oil prices during the next two years will lead to a significant improvement in the fiscal and external positions of Gulf Co-operation Council (GCC) sovereigns, partly reversing their sharp deterioration in their balance sheet since 2015. Moody's said in both Oman and Qatar, it assumes that non-interest spending will grow less than 2% in nominal terms this year and the next. However, in both cases, there is a "significant" degree of uncertainty about how the elevated oil price windfall will be distributed between the national oil company (QatarEnergy and Energy Development Oman) and the budget; and to what extent the budgetary surpluses will be used for debt reduction or to build sovereign fiscal buffers (through transfers to Qatar Investment Authority or to the Petroleum Reserve Fund in Oman). For the higher-rated GCC sovereigns, other than Qatar, upward credit pressures will be limited to modest improvements in economic strength (mainly due to higher nominal gross domestic product or GDP and some pickup in trend growth) but the credit profiles will remain steady and upwardly constrained by the sovereigns' large exposures to longer-term carbon transition risks and their ability to, over time, mitigate these risks. "We expect oil prices to average around $105/barrel in 2022 and $95 in 2023 as geopolitical risks stemming from Russia's military invasion outweigh risks to global oil demand," Perjessi said. Consequently, most hydrocarbon-exporting sovereigns will run twin fiscal and current-account surpluses, allowing the governments to pay down debts, rebuild fiscal reserves and accumulate foreign-currency buffers, thereby reducing government liquidity and external vulnerability risks, he added. The recovery in global oil demand and prices from the 2020 pandemic slump has allowed the major hydrocarbon producers, including those in the GCC region, to ramp up their production by reversing most of the production cuts implemented by the Organisation of Petroleum Exporting Countries and their allies in May 2020. "We expect the combination of higher oil prices and production volumes to lead to a significant improvement in GCC external and government finances, which is likely to be largely sustained through 2023 and, for some, also into 2024," Perjessi said, adding the GCC sovereigns could pay down some of their outstanding debts with the expected fiscal surpluses, or at least keep their debt levels steady in nominal terms.    

Higher oil prices are slated to boost the Gulf funds’ assets under management (AUM) and attract higher fund inflows, according to Moody’s. This will support fee revenues, although the sector also faces headwinds from more volatile markets, higher inflation and rising interest rates, said Moody's 2022 survey of chief investment officers (CIOs) from eight leading GCC fund firms. The key findings were disclosed yesterday at a media roundtable. Respondents expect continued strong demand for Shariah-compliant investments, but foresee more moderate growth in investments that meet environmental social and governance (ESG) criteria. Respondents are bullish regarding AUM levels despite the global market downturn because high oil prices will support the value of their portfolios, which consist mainly of regional assets, while also attracting net new money. This will help counteract the adverse impact of volatile markets, higher inflation and rising rates, it said. Highlighting that the GCC countries are highly dependent on oil exports, it said strong oil prices can boost their economic growth and support public spending. For Saudi Arabia, the GCC’s largest economy, accounting for the majority of the region's assets under management, the rating agency forecasts 7.2% real GDP growth in 2022, up significantly from 3.3% in 2021. "This substantial acceleration reflects increased oil production as well as terms-of trade benefits to the economy from high oil prices and a strong US dollar. This will in turn help spur non-oil sector activity," it said. Finding that market volatility, inflation and rates are key concerns; Moody's said capital market volatility is GCC asset managers' biggest worry over the next 12 months, with a cumulative 88% of respondents placing it among their top three concerns. The GCC asset managers who invest largely in the regional assets have been less exposed to the market volatility experienced by global peers, as high oil prices have buffered domestic equity markets. The GCC asset managers’ second greatest worry is the increasing inflation, cited by a cumulative 75% of respondents as a top three concern. Rising inflation can adversely affect asset valuations, exacerbating market volatility, and increasing outflows. It can also push up asset managers’ input costs, particularly compensation expenses. However, inflation in the GCC countries has increased more modestly than elsewhere, and we expect it to remain below the average for both emerging markets and advanced economies. Observing that appetite for Islamic assets remains strong; Moody's said as much as 63% of survey respondents expect further growth in demand for Islamic investment assets, with the remainder foreseeing broadly stable demand. The same proportion expects demand for Islamic products to outpace demand for conventional investments.    

The Qatar Stock Exchange on Monday gained more than 91 points and its key index inched towards 13,200 levels, paced by strong buying interests in banking, transport and telecom counters. The foreign institutions were increasingly net buyers as the 20-stock Qatar Index gained 0.7% to 13,194.9 points, recovering from an intraday low of 13,097 points. The Arab retail investors were seen bullish in the market, whose year-to-date gains were at 13.5%. The foreign individuals were increasingly into net buying in the bourse, whose capitalisation soared QR5.82bn or 0.8% to QR733.26bn mainly on the back of mid and microcap segments. The Islamic index was seen gaining slower than the other indices in the market, which saw a total of 0.09mn exchange traded funds (sponsored by Masraf Al Rayan and Doha Bank) valued at QR0.64mn changed hands across 24 deals. Trade turnover grew amidst lower volumes in the main market, while in the venture market, both turnover and volumes were on the decline. The local retail investors continued to be net sellers but with lower intensity in the bourse, which saw no trading of sovereign bonds. The domestic institutions were increasingly net profit takers in the market, which saw no trading of treasury bills. The Total Return Index gained 0.7% to 27,027.43 points, the All Share Index by 0.81% to 4,181.65 points and the Al Rayan Islamic Index (Price) by 0.45 to 2,911.29 points. The banks and financial services sector index shot up 1.51%, transport (0.95%), telecom (0.83%) and consumer goods and services (0.27%); while insurance declined 1.64%, real estate (0.21%) and industrials (0.17%). Major gainers in the main market included Qatari German Medical Devices, QNB, Milaha, Dlala, QIIB, Baladna, Qatari Investors Group, Aamal Company, Qamco and Ooredoo. In the venture market, Mekdam Holding saw its shares appreciate in value. Nevertheless, more than 53% of the traded constituents were in the red with major losers being Mannai Corporation, Qatar Cinema and Film Distribution, Qatar Insurance, Estithmar Holding, Al Khaleej Takaful, Widam Food, Al Meera, United Development Company, Ezdan and Vodafone Qatar. The foreign institutions’ net buying increased noticeably to QR55.91mn compared to QR39.8mn on September 11. The Arab individuals turned net buyers to the tune of QR3.23mn against net sellers of QR4.05mn the previous day. The foreign individuals’ net buying strengthened markedly to QR0.81mn compared to QR0.27mn on Sunday. Qatari individuals’ net selling eased marginally to QR17.07mn against QR17.19mn on September 11. However, the domestic institutions’ net selling grew perceptibly to QR22.25mn compared to QR17.7mn the previous day. The Gulf institutions were net sellers to the extent of QR13.14mn against net buyers of QR0.9mn on Sunday. The Gulf retail investors’ net selling expanded noticeably to QR7.49mn compared to QR2.02mn on September 11. The Arab institutions continued to have no major net exposure for the sixth straight session. Total trade volume in the main market fell 45% to 139.54mn shares, while value zoomed 82% to QR534.82mn on more than doubled deals to 19,099. In the venture market, there was a 65% contraction in trade volumes to 0.09mn equities, 66% in value to QR0.65mn and 30% in transactions to 56.    

Qatar banks are expected to see improvement in bottom-line, and return on assets should reach pre-Covid levels by 2023, according to a top official of Moody's, a credit rating agency. "We expect the banks' bottom-line profitability to continue to improve in 2022 as operating income continues to grow, while provisioning charges should stabilise," Nitish Bhojnagarwala, vice president, senior credit officer, Moody's told a roundtable on Monday. Net profit of the Qatari banks rose 4% year-on-year in the first half of 2022, driven by widening net interest margins and higher noninterest income. The Qatari banks Moody's rates reported an aggregate net profit of QR12.9bn in the review period. The one-off accounting adjustment on hyperinflation in Turkiye, where QNB and Commercial Bank had exposure, had lowered the Qatari banks profitability by QR813mn. Had it not been for the adjustment, Qatar's banks’ bottom-line would have seen an 11% growth in the first half of 2022, he said. The growth in net profit was consistent across the banks with the exception of one bank, and largely driven by an 11% increase in net interest income and 8% growth in noninterest income such as fees and commissions. Highlighting that the banks maintained their capital buffers during the year, supported by strong earnings and solid profit retention, it said their combined tangible common equity marginally increased to 15.4% of risk-weighted assets as of June 2022 from 15.3% a year earlier. "We expect solid profitability to continue to support healthy capital buffers," he added. Expecting Qatar's real gross domestic product or GDP to grow by 2.7% in 2022 (2.4% in 2023) after contracting by 3.6% in 2020; Bhojnagarwala said the recovery this year will be supported by projects and spending linked to the gradual increase in hydrocarbon production, higher oil prices and robust non-hydrocarbon economic activity following a relaxation of travel and restriction of movement measures imposed at the height of the pandemic, and tourism activity related to the 2022 FIFA World Cup. Higher net interest margins or NIMs were driven by asset yields, which rose as interest rates reset during the first half of the year and offset some of the increase in funding costs, he said, adding the funding composition of Qatari banks has shifted, with an increasing reliance on external funding, mostly driven by larger banks. "We expect benchmark interest rates to rise this year, combined with increased lending volumes on the back of robust economic growth, to support Qatari banks' net interest income over the next 12-18 months," he said, adding “a little more bottom-line growth and returns should reach pre-Covid levels, hopefully by next year.” The banks continued to improve their operating efficiency in the first half of the year as income growth surpassed growth in expenses, easing pressure on their bottom-line profit. While the benefits of the cost control measures initiated during the pandemic accrued fully in 2021, aggregate operating expenses for the Qatari banking sector increased by 1% during the current period.    

Rebound in oil prices at the end of last week helped improve sentiments on the Qatar Stock Exchange, which Sunday gained a huge 155 points and its key index crossed the 13,100 levels. The foreign institutions turned bullish as the 20-stock Qatar Index rose 1.19% to 13,103.54 points, recovering from an intraday low of 13,041 points. The real estate and banking counters witnessed higher than average demand in the market, whose year-to-date gains were at 12.71%. More than 73% of the traded constituents extended gains in the bourse, whose capitalisation soared QR7.99bn or 1.11% to QR727.44bn mainly on the back of large and midcap segments. The Islamic index was seen gaining faster than the other indices in the market, which saw a total of 0.09mn exchange traded funds (sponsored by Masraf Al Rayan and Doha Bank) valued at QR1.05mn changed hands across 38 deals. Trade turnover and volumes were on the decline in the main market, while the venture market saw higher turnover and volumes. The local retail investors were however net sellers in the bourse, which saw no trading of sovereign bonds. The domestic institutions were increasingly net profit takers in the market, which saw no trading of treasury bills. The Total Return Index gained 1.19% to 26,840.29 points, the All Share Index by 1.1% to 4,148.14 points and the Al Rayan Islamic Index (Price) gained 1.2% to 2,898.3 points. The real estate sector index soared 2.41%, banks and financial services (1.31%), industrials (1.05%), telecom (0.95%), insurance (0.87%) and transport (0.6%); while consumer goods and services declined 0.35%. Major gainers in the main market included QLM, United Development Company, Industries Qatar, Medicare Group, Barwa, Mesaieed Petrochemical Holding, Qatar Islamic Bank, QIIB, Qatar First Bank, Baladna, Estithmar Holding, Ezdan, Ooredoo, Gulf Warehousing and Salam International Investment. In the venture market, Mekdam Holding saw its shares appreciate in value. Nevertheless, Mannai Corporation, Widam Food, Qatari German Medical Devices, Woqod and Dlala were among the losers in the main market. The foreign institutions turned net buyers to the tune of QR39.8mn compared with net sellers of QR10.48mn on September 8. However, the domestic institutions’ net selling grew considerably to QR17.7mn against QR0.52mn the previous trading day. Qatari individuals were net sellers to the extent of QR17.19mn compared with net buyers of QR8.01mn last Thursday. The Arab individuals’ net profit booking strengthened markedly to QR4.05mn against QR1.1mn on September 8. The Gulf retail investors’ net selling expanded noticeably to QR2.02mn compared to QR0.63mn the previous trading day. The Gulf institutions’ net buying shrank significantly to QR0.9mn against QR3.88mn last Thursday. The foreign individuals’ net buying eased marginally to QR0.27mn compared to QR0.85mn on September 8. The Arab institutions continued to have no major net exposure for the fifth straight session. Total trade volume in the main market fell 16% to 95.92mn shares, value by 37% to QR295.22mn and deals by 49% to 9,145. In the venture market, there was an 18% jump in trade volumes to 0.26mn equities and 16% in value to QR1.9mn but on 24% shrinkage in transactions to 80.

Qatar has witnessed increased reuse of treated wastewater for agricultural purposes in July on an annualised basis, indicating the country's commitment towards sustainability. Qatar’s treated wastewater stood at 21.42mn cubic metres out of 21.84mn cubic metres of wastewater received in July this year, the PSA said. The treated wastewater saw 1.7% and 1.1% growth year-on-year and month-on-month respectively in the review period. The treated wastewater reused for agriculture witnessed a 17.7% year-on-year growth to 7.33mn cubic metres, which accounted for more than 34% of the total treated wastewater. On yearly basis, the reuse of treated wastewater for agriculture saw a 1.1% jump in July 2022. Qatar Environment and Energy Research Institute, part of Hamad Bin Khalifa University, has developed a seawater desalination pilot plant which is showing higher efficiency than conventional technology – both in energy recovery to reduce thermal energy consumption, and cost effectiveness. The agriculture sector has been receiving increased thrust and support of the sovereign as part of the self-sustaining initiatives. Qatar plans to achieve 70% self-sufficiency in the production of certain vegetables by 2023 but water resource remains a major concern to sustainably continue its journey, Dr Sa’d Abdel-Halim Shannak, a scientist at Qatar Environment and Energy Research Institute, had said recently. “Maximising use of treated wastewater and pricing reform,” he said. The treated wastewater reused in irrigation of green spaces amounted to 10.96mn cubic metres, which accounted for more than 50% of the total treated wastewater this July. The reuse of treated wastewater in irrigation of green spaces witnessed a 0.6% yearly increase but saw a 4.2% plunge on yearly basis in the review period. The treated wastewater reused in deep injection into aquifers stood at 2.23mn cubic metres, but registering 26.1% and 2.4% decline year-on-year and month-on-month respectively in August 2022. Such reuse accounted for more than 10% of the total treated wastewater in the review period. A large quantity of treated wastewater – up to 40% – which at certain times of the year – is either discharged to lagoons or injected to the deep aquifers, Dr Shannak said. The treated wastewater discharged into lagoons in July this year stood at 1.32mn cubic metres or more than 6% of the total treated wastewater re-used. Such discharge saw a 3.4% and 61.5% surge on yearly and monthly basis respectively. There was no discharge of treated wastewater into the sea in August 2022. The PSA bulletin said the water produced was 58.51mn cubic metres; while consumption was 57.41mn cubic metres in the review period.

The brokerage subsidiary of Commercial Bank as well as Wasata Financial Services witnessed more than doubling of its share trade turnover year-on-year during the first eight months of this year, according to Qatar Stock Exchange data. The Group Securities, QNB Financial Services and Commercial Bank Financial Services (CBFS) together accounted for more than 83% of the share trade turnover of the brokerages in the QSE during the review period. The Group Securities’ share stood at 38.15% in January-August 2022 compared to 46.12% in the previous-year period. Its trading turnover surged 32.8% year-on-year to QR94.87bn. The transactions through it expanded 27.44% to 2.09mn even as volumes shrank 7.51% to 41.04mn equities at the end of August 30, 2022. The QNB subsidiary QNBFS' trade turnover amounted to QR79.52bn, which constituted 31.98% of the total traded value during January-August 2022 against 27.05% a year-ago period. The turnover zoomed 89.74% year-on-year as volumes shot up 60.45% to 10.83mn stocks on more than tripled transactions to 2.07mn in the review period. CBFS accounted for 12.53% of trade turnover compared to 8.59% during January-August 2021. The brokerage house's trade turnover more than doubled year-on-year to QR31.15bn as volumes also more than doubled to 6.78mn shares and deals more than doubled to 796,359 in the review period. CBFS last year launched its margin trading product, becoming the first bank brokerage subsidiary in Qatar to launch such a product. The Qatar Financial Market Authority had approved the Group Securities and Commercial Bank Financial Services as liquidity providers, while saying other licences are on the pipeline. In May 2013, the financial market regulator had approved the liquidity provision scheme that can be carried out by the financial services firms. Qatar Securities accounted for 7.25% of trade turnover during January-August 2022 compared to 7.19% the previous year period. The brokerage's trading turnover surged 61.85% year-on-year to QR18.03bn although volumes through it fell 3.25% to 2.98mn equities despite almost doubled transactions to 190,172 at the end of August 2022. Wasata Financial Securities' share was 3.98% of trading turnover during January-August compared to 2.62% in the comparable period of 2021. Its trade turnover more than doubled year-on-year to QR9.89bn as volumes zoomed 54.74% to 2.94mn shares and transactions more than doubled to 152,262 at the end of August 31, 2022. Dlala Brokerage, a stock broking business arm of Dlala Holding, accounted for 4.07% of trade turnover (QR10.12bn), which declined 2.03% year-on-year. The brokerage’s share was 6.66% the previous year period. The deals through it were up 0.48% on a yearly basis to 190,172 but volumes shrank 38.66% to 3.3mn stocks at the end of August 2022. Al-Ahli Brokerage, a subsidiary of Ahlibank Qatar, saw its trade turnover expand 84.73% on an annualised basis to QR5.08bn, cornering a market share of 2.04% during January-August 2022 compared to 1.77% a year ago period. The volumes handled by the banking subsidiary shot up 40.28% to 1.01mn equities even as deals through it doubled to 100,211 during the review period.

The Qatar Stock Exchange saw its key index tank 234 points and capitalisation erode QR14bn, reflecting the pessimism in the global market as oil once touched a seven-month low this week. The telecom, transport and banking counters witnessed higher than average selling pressure as the 20-stock Qatar Index plunged 1.78% this week, which saw the Qatar Financial Market Authority issue rules relating to covered short selling as well securities lending and borrowing. The domestic institutions were seen net profit takers this week, which saw Mannai Corporation shareholders approve an interim dividend, following the successful sales of Inetum. More than 74% of the traded constituents were in the red this week, which saw a Qatar Financial Centre’s purchasing managers’ index survey that found the tempering of growth in the country’s non-energy private sector in August this year. The local retail investors were seen bearish this week, which saw Ooredoo disclose its intention to offload its entire stake in its Myanmar telecom business to Nine Communications for an enterprise value of about $576mn and total equity consideration of $162mn. The foreign individuals’ weakened net buying also had its influence in the market this week, which saw Al Meera Consumer Goods sign agreement with SAP and Tata Consultancy. However, the foreign institutions were seen bullish this week, which saw a total of 0.11mn Masraf Al Rayan-sponsored exchange traded fund QATR worth QR0.3mn trade across 27 deals. The Arab retail investors were increasingly net buyers this week, which saw as many as 0.18mn Doha Bank-sponsored QETF valued at QR2.3mn change hands across 99 transactions. The overall trading turnover and volumes were on the decline in the main market this week, which saw the industrials and banking sectors together constitute more than 58% of the total trade volume. Market capitalisation eroded QR13.79bn or 1.87% to QR719.45bn, mainly on large and small cap segments this week, which saw no trading of sovereign bonds. In the case of venture market, both trade and turnover were on the increase this week, which saw no trading of treasury bills in the main market. The Total Return Index tanked 1.78%, the All Share Index by 1.8% and the All Islamic Index by 1.24%. The telecom sector index plummeted 3.44%, real estate (3.12%), banks and financial services (2.53%), industry (1.39%), insurance (0.5%) and consumer goods and services (0.5%); while transport soared 2.01% this week. Major losers in the main market included Mannai Corporation, Qamco, Doha Insurance, Gulf International Services, Mesaieed Petrochemical Holding, QNB, Commercial Bank, Qatar Islamic Bank, Doha Bank, QIIB, Masraf Al Rayan, Salam International Investment, Baladna, Aamal Company, Estithmar Holding, Barwa, Mazaya Qatar, Ooredoo, Vodafone Qatar, Nakilat and Gulf Warehousing. In the venture market, both Al Faleh Educational Holding and Mekdam Holding saw their shares depreciate in value. Nevertheless, Milaha, Ezdan, Woqod, Al Meera and Qatar National Cement were among the gainers in the main market this week. The domestic institutions turned net sellers to the tune of QR88.06mn compared with net buyers of QR6.57mn the week ended September 1. The local retail investors were net sellers to the extent of QR58.05mn against net buyers of QR26.35mn the previous week. The foreign individuals’ net buying weakened markedly to QR4.78mn compared to QR8.16mn a week ago. However, the foreign funds were net buyers to the tune of QR120.91mn against net sellers of QR32.37mn the week ended September 1. The Arab individuals’ net buying increased perceptibly to QR17.27mn compared to QR16.63mn the previous week. The Gulf individuals were net buyer to the tune of QR24.65mn. The Arab institutions’ net profit booking eased marginally to QR0.37mn against QR0.7mn the week ended September 1. Total trade volume in the main market shrank 21% to 6790422mn shares, value by 31% to QR2.53bn and deals by 3% to 92,447. In the venture market, there was a 28% jump in trade volumes to 1.13mn stocks, 12% in value to QR6.96mn and 17% in transactions to 405.