Qatar shares edge higher, but fail to break the 13,000 resistance level

By Santhosh V Perumal/Business Reporter

The Stock Exchange yesterday opened the week on a stronger note, mainly on buying interests in realty, transport and banking stocks, but failed to break the 13,000 resistance level.

Domestic institutions were mainly instrumental in lifting the 20-stock Qatar Index (based on price data) by 0.26% to 12,995.05 points.

Opening strong, the market witnessed some hectic profit-booking within the first 15 minutes to take the index little above 12,700 points, but soon regained strength for the remainder of the day to finally settle a tad below the 13,000 level.

Net selling pressure was, however, visible within domestic institutions in the market, which is up 25.2% year-to-date.

Trading activities were on the decline and was overall skewed towards banking, industrials and realty equities.

The 20-stock Total Return Index rose 0.26% to 19,378.43 points and the Al Rayan Islamic Index by 0.14% to 4,287.93, while the All Share Index (with wider constituents) was unchanged at 3,302.58. All the three indices factored in dividend income as well.

Real estate stocks appreciated 0.74%, followed by transport (0.49%), banks and financial services (0.32%) and industrials (0.02%), while consumer goods tanked 2.03%, insurance 1.85% and telecom lost 0.34%.

Major gainers included Barwa, United Development Company, Nakilat, Qatar Islamic Bank, Commercial Bank, Doha Bank, Masraf Al Rayan, Gulf International Services Alijarah Holding, Dlala and Widam Food.

However, QNB, Ezdan, Mazaya Qatar, Woqod, Mannai Corporation, Ooredoo, Vodafone Qatar, Aamal Company, Woqod, Ezdan, Mesaieed Petrochemical Holding and Qatar Investors Group bucked the trend.

Market capitalisation eroded 0.69% or more than QR5bn to QR726.88bn. Mid and micro cap equities gained 0.46% and 0.21%, while small and large caps fell 0.41% and 0.24% respectively.

Domestic institutions’ net buying surged to QR55.49mn compared to QR9.95mn last Thursday.

Foreign institutions’ net buying fell to QR24.38mn against QR78.17mn the previous trading day.

Qatari retail investors turned net sellers to the tune of QR45.33mn compared with net buyers of QR6.8mn last Thursday.

Non-Qatari individual investors’ net profit-booking sunk to QR34.62mn against QR94.92mn the previous trading day.

Total trading volume was down 2% to 16.41mn stocks and value by 6% to QR781.56mn, whereas transactions rose 13% to 9,328.

The telecom sector’s trading volume plummeted 72% to 1.76mn equities, value by 82% to QR36.46mn and deals by 59% to 425.

The real estate sector saw its trading volume decline 8% to 2.6mn shares and value by 15% to QR74.53mn, while transactions were up 1% to 1,205.

However, the banks and financial services sector reported an 82% surge in trading volume to 5.43mn stocks, 48% in value to QR250.81mn and 59% in deals to 2,653

The consumer goods sector’s trading volume soared 57% to 2.46mn equities, value by 15% to QR174.34mn and transactions by 30% to 1,998.

There was a 48% jump in the transport sector’s trading volume to 1.21mn shares, 40% in value to QR34.09mn and 43% in deals to 511.

The market witnessed a 33% expansion in the industrials sector’s trading volume to 2.67mn stocks, 7% in value to QR193.27mn and 4% in transactions to 2,355.

The insurance sector saw its trading volume gain 12% to 0.28mn equities and value by 71% to QR18.05mn, whereas deals were down 10% to 181.

In the debt market, there was no trading of treasury bills and government bonds.

Dubai stocks drop on retail profit-booking

Dubai’s bourse posted its biggest daily loss in a month yesterday as retail investors booked profits.

Dubai’s index plunged 3.1% and Emaar Properties and Emirates NBD were the main drags, down 1.9% and 3.2%, respectively.

But smaller names displayed more volatility. Arabtec fell 9.2%, Deyaar dropped 6.8% and Air Arabia was down 6.3%.

“We have some profit-taking in the market by retail investors... and I think institutional investors are not really present,” said Sebastien Henin, head of asset management at The National Investor.

The sell-offs focused on the names that had been subject to most speculation in recent weeks, he said.

Contractor Arabtec’s share price has more than tripled this year, while the value of Union Properties stock has more than doubled. Air Arabia had lagged the wider market but became one of the top performers this month, jumping 20%.

Last week, Arabtec said its first-quarter profit had jumped 121%. But some analysts say the figure, while formidable, might be not high enough to support such a sharp share price increase.

“I think it’s just another bout of profit-taking, which is probably healthy, and I think it was really led by Arabtec,” said Sanyalak Manibhandu, senior analyst at NBAD Securities. “Investors have seen the first-quarter numbers and are waiting for the conference call with the management this week. They are probably saying to themselves they can’t justify such high multiples.”

Arabtec branched out this year into development with a $40bn project in Egypt, trades at a trailing price-to-earnings ratio of 62, while other builders and developers in the Gulf are within 20 to 26.

Henin from The National Investor said the market is likely to continue moving in large swings as investors prepare for the upgrade of the UAE and Qatar to emerging market status by index compiler MSCI at the end of this month.

“We should expect to see more volatility in the coming weeks,” he said.

Abu Dhabi’s index fell 1.2% to 4,988 points, breaking through support at 5,000 points. The main drag on the market was property firm Aldar, which fell 6.1%.

Only a handful of stocks closed higher. Green Crescent Insurance, whose profit surged to 6.3mn dirhams in the first quarter, jumped 7.2%.

Saudi Arabia’s index pulled back 0.2%, dragged down by banks and cement makers.

Elsewhere in the Gulf, Kuwait’s index gained 0.03% to 7,409 points; Bahrain’s measure fell 0.3% to 1,467 points, while Oman’s index slid 0.7% to 6,781 points.

Egypt’s benchmark added 0.2% to 8,227 points.