Sharp correction, profit booking drags QSE 127 points
May 20 2016 08:05 PM

By Santhosh V. Perumal/Business Reporter

The global oil prices rebound to $50 a barrel and then a sharp correction on Thursday had its reflection in the Qatar Stock Exchange (QSE) during the week.

Accordingly, the bourse lost more than 127 points; mainly on foreign institutions’ profit booking during the week which witnessed Ezdan Holding Group disclose 1.67 times oversubscription to its $500mn sukuk, the first ever international issuance by a private sector Qatari corporate in the debt capital markets.

Telecom, consumer goods, real estate and banking counters witnessed heavy sell off during the week which saw Barwa Real Estate Group sign financing agreements worth QR 4.12bn with a local Qatari bank for a term of nine years.

Islamic stocks were seen declining faster than other conventional ones during the week which saw QSE disclose that it has started initiatives to help brokers reduce their IT operational, licensing and maintenance costs, a move that could drastically improve the bottom lines of the brokerage houses.

Both domestic institutions and non-Qatari individual investors turned bullish during the week which saw the 20-stock Qatar Index plunge 1.28%.

Opening the week strong at 9,950 points on Sunday, the market witnessed consistent gains for the next two days to take the index to above 10,000 levels, reflecting the rebound in global oil prices, which touched $50 a barrel. Thereafter, the index was rather flat on Wednesday but only to lose heavily to settle at 9,814 points, as speculation was rife that the US Fed may increase rates, following which oil prices tumbled and settle below $48.

The 20-stock Total Return Index shed 1.28%, All Share Index (comprising wider constituents) by 1.23% and Al Rayan Islamic Index 2.01% during the week which saw the trading turnover increase amid fall in volumes.

Telecom stocks shrank 3.32%, consumer good (2.29%), realty (1.99%), banks and financial services (1.39%), industrials (0.91%) and transport (0.17%); while insurance surged 2.48% during the week which saw Milaha and DSV, a Denmark-based provider of global transport and logistics, sign an agreement by virtue of which Milaha will become the exclusive agent for DSV in Qatar, in an effort to broaden its global footprint.

Market capitalisation eroded 1.31% or more than QR7bn to QR528.07bn during the week which witnessed Vodafone Qatar decide to augment its traditional revenue streams and invest in a cost-effective approach in the country's fixed service potential this year.

Of the 44 stocks, as many 30 declined, while only 12 rose and two were unchanged. Eight of the 13 banks and financial services; six of the nine industrials; five of the eight consumer goods; three each of the five insurers, the four real estate and the three transport; and all of the two telecom stocks close lower during the week.

More than 68% of the scrips were in the red with major loser being Ooredoo, Vodafone Qatar, Ezdan, Mazaya Qatar, Qatari Investors Group, Industries Qatar, Qatar Islamic Bank, Doha Bank, Masraf Al Rayan, Widam Food, Medicare Group and Barwa; even as Gulf International Services, Qatar Insurance and Commercial Bank were seen bucking the trend during the week which saw financial experts view that the dismantling of administered domestic fuel price mechanism is expected to be positive for the Qatari economy but could have 'one-off' impact on inflation.

Foreign institutions turned net sellers to the tune of QR60.22mn compared with net buyers of QR84.33mn the previous week.

However, domestic institutions turned net buyers to the extent of QR51.68mn against net sellers of QR89.34mn the week ended May 12.

Local retail investors’ net buying increased to QR8.15mn compared to QR7.65mn the previous week.

Non-Qatari individual investors turned net buyers to the extent of QR0.4mn against net profit takers of QR2.64mn the week ended May 12.

Total trade volume rose 8% to 43.02mn shares, while value fell 4% to QR1.34bn and transactions by 9% to 22,522 during the week.

The telecom sector’s trade volume more than doubled to 8.28mn equities and value almost doubled to QR145.59mn on 45% jump in deals to 3,937.

The industrials sector reported 56% surge in trade volume to 12.53mn stocks, 34% in value to QR488.83mn and 24% in transactions to 6,771.

The insurance sector’s trade volume soared 20% to 0.54mn shares, value by 15% to QR37.15mn and deals by 1% to 587.

However, there was 54% plunge in the real estate sector’s trade volume to 3.34mn equities, 52% in value to QR70.36mn and 39% in transactions to 2,287.

The transport sector’s trade volume plummeted 50% to 1.55mn stocks, value by 54% to QR57.97mn and deals by 54% to 831.

The market witnessed 16% shrinkage in the consumer goods sector’s trade volume to 3.02mn shares, 34% in value to QR157.18mn and 29% in transactions to 2,468.

The banks and financial services sector’s trade volume declined 3% to 13.75mn equities, value by 6% to QR378.23mn and deals by 18% to 5,641.

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

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