Qatar Stock Exchange continued to remain under bearish pressure for the fourth straight session and capitalisation lost another QR12bn yesterday, mainly dragged by the industrials, transport and telecom stocks.
Domestic institutions’ increased profit booking led the 20-stock Qatar Index (based on price data) shed another 0.42% to 12,734.15 points.
The market witnessed sharp buying pressure in the first 45 minutes to take the index to a high of more than 12,850 points but severe profit booking ensued thereafter for the next 30 minutes, taking the index to a low of just over 12,650 points. Buying interests reversed the trend for the next 60 minutes but the market was once again gripped by selling intensity but at lesser gradient.
However, the index that tracks Shariah-principled stock was seen losing slower than the other indices in the market, which is, however, up 22.68% year-to-date.
Trading volume was marginally on the rise and was skewed towards real estate, banks, industrials and telecom stocks.
The 20-stock Total Return Index fell 0.42% to 18,989.36 points, All Share Index (with wider constituents) by 0.55% to 3,238.72 and Al Rayan Islamic Index by 0.29% to 4,231. All the three indices factored in dividend income as well.
Telecom stocks shrank 1.38%, industrials (1.3%), telecom (0.65%), consumer goods (0.37%) and banks and financial services (0.26%); whereas realty and insurance gained 0.58% and 0.46% respectively.
More than 60% of the stocks were in the red with major losers being Industries Qatar, Ezdan, Aamal Company, Vodafone Qatar, Ooredoo, Nakilat, Qatar Islamic Bank, Commercial Bank, Doha Bank, Alijarah Holding, Mazaya Qatar, Mesaieed Petrochemical Holding and Qatari Investors Group.
However, Masraf Al Rayan, Gulf International Services, United Development Company and Doha Insurance were seen to buck the trend.
Market capitalisation eroded 1.72% to QR711.64bn.
Domestic institutions’ net selling surged to QR109.89mn compared to QR1.14mn on Monday.
However, foreign institutions’ net buying rose to QR22.98mn against QR1.14mn the previous day.
Qatari retail investors’ net buying also enhanced to QR80.86mn compared to QR6.06mn on Monday.
Non-Qatari individual investors turned net buyers to the tune of QR5.86mn against net profit takers of QR5.87mn the previous day.
Total trading volume was up 3% to 21.96mn stocks and value by 2% to QR961.44mn but transactions were down 1% to 10,086.
The banks and financial services sector reported 42% plunge in trading volume to 3.75mn equities, 20% in value to QR271.94mn and 22% in deals to 2,193.
The market witnessed 4% decline in the industrials sector’s trading volume to 2.88mn shares, while value rose 10% to QR204.73mn and transactions by 3% to 2,587.
The consumer goods sector’s trading volume was down 2% to 0.94mn stocks, value by 36% to QR53.88mn and transactions by 30% to 592.
However, the transport sector’s trading volume zoomed 74% to 1.22mn equities, value by 55% to QR38.25mn and deals by 20% to 492.
There was 36% surge in the real estate sector’s trading volume to 10.43mn shares, 27% in value to QR294.89mn and 17% in transactions to 3,204.
The insurance sector saw its trading volume expand 21% to 0.46mn stocks and value by 25% to QR19.71mn but on a 7% fall in deals to 187.
The telecom sector’s trading volume soared 15% to 2.29mn equities, value by 22% to QR78.03mn and transactions by 31% to 831.
In the debt market, there was no trading of treasury bills and government bonds.
Dubai tumbles to 6-week low; Saudi lacklustre on listings pipeline
Dubai’s index tumbled to a six-week low yesterday as investors booked profits from a near 18-month bull run, while Saudi Arabia’s bourse was again lacklustre and is seen stuck in the doldrums until July’s results season.
Dubai’s benchmark dropped 4.1% to 4,656 points, its lowest finish since April 7.
It fell 5.5% the day before and rebounded in early trade yesterday, but buying pressure was brief and it has fallen 12.6% in a week, trimming 2014 gains to 38.2%.
“A revaluation of the market has been happening for the past week - the fundamentals haven’t changed, it’s pure profit-taking by speculators,” said Samer al-Jaouni, a Gulf-based trader.
Dubai’s measure is up 187% since the start of 2013 as renewed confidence in Dubai’s property sector and a retail and tourism boom brought traders back to the emirate’s beleaguered stock market.
But analysts had warned that such a surge was unsustainable, even with index compiler MSCI upgrading the United Arab Emirates to emerging market status, effective June 1.
“A lot of the earlier buying was by speculators ahead of MSCI,” said Jaouni.
He said high valuations were likely to deter foreign funds that track MSCI’s emerging index from buying UAE stocks immediately after the upgrade comes into effect.
“We might see a further downside to levels where prices can be justified,” said Jaouni, adding this would likely be around 4,200 to 4,300 points. “Investors will be much pickier — volatility will remain high and we’ll still see some speculation, but it will be much less than before and volumes may decline dramatically in the coming months.”
Most of yesterday’s activity was aimed at property-related stocks, which are a favourite target for day-traders. Builder Arabtec fell 8.6%, Emaar Properties dropped 3.7% and Union Properties lost 2.8%.
Abu Dhabi fell 2.5% to a two-month low of 4,750 points. It is up 10.7% in 2014.
Elsewhere, Saudi Arabia’s index rose 0.07% to 9,731 points, but is down 1% from Wednesday’s six-year high, having failed to break above 9,830 points.
“It gives the possibility for new cash to come into the market,” said Hesham Tuffaha, a Riyadh-based portfolio manager.
“When there’s a continuous rally, there’s usually money on the sidelines waiting for a correction.”
He said Saudi’s stuttering performance in the past week was due to a glut of local share sales in the offing. These include floatations from National Commercial Bank, the kingdom’s largest lender, and hotel and leisure group Abdul Mohsen al-Hokair.
On Monday, the Saudi regulator also granted approval for healthcare firm Al Hammadi Company For Development & Investment to float 30% of its shares. Samba Capital will arrange the offering, which will consist of a bookbuilding period with institutional investors before being opened to subscription by retail investors between June 11-17.
“Fund managers are under pressure to liquidate some positions to free up cash for these,” said Tuffaha.
He predicted the kingdom’s bourse will trade between 9,700 and 9,800 points until early in July, when second-quarter earnings season begins.
Egypt’s index climbed 0.9% to its highest close since August 2008.
Elsewhere, the Kuwait index rose 0.4% to 7,380 points, the Oman index rose 0.3% to 6,797 points and the index dropped 0.3% to 1,450 points.