The merger moves among Masraf Al Rayan, Barwa Bank and International Bank of Qatar lifted the overall sentiments in the Qatar Stock Exchange (QSE), which was the best performer among the Gulf bourses during the week.

 The bullish outlook of domestic institutions led the QSE gain 1.99% during the week which saw Commercial Bank become the sole owner of Turkey’s Alternatifbank (ABank) after Anadolu Endüstri Holding exercised its put option on its remaining 25% stake in ABank for $222.5mn.

Bahrain rose 0.85%, Muscat and Kuwait (0.14% each) and Saudi Arabia (0.04%), while Dubai and Abu Dhabi fell 1.04% and 0.59% respectively during the week which saw BMI Middle East and North Africa analyst Raphaële Auberty view that Qatar’s budgeted investment in infrastructure projects will spur growth in the construction sector, and act as a catalyst for economic diversification in the country.

QSE, however, saw its year-to-date losses pare down to mere 0.01% compared to 1.4% in Bahrain, whereas Dubai reported gains of 11.63%, Muscat (6.11%), Abu Dhabi (3.01%), Saudi Arabia (2.55%) and Kuwait (1.09%).

Banking and telecom sectors registered higher than average buying in the QSE during the week which witnessed Ooredoo’s preliminary negotiations with Salam International on a potential acquisition of a majority stake in the latter’s IT subsidiary.

Islamic stocks were seen gaining faster than the conventional scrips during the week which saw Kamco view that the (expected) hardening of interest rates in the Gulf Cooperation Council, in view of the US Federal Reserve policy stance, is likely to add to the existing challenges for the region as lower growth and higher borrowing costs for the corporate and consumer segments.

Large cap equities were seen outperforming the main index during the week which saw Qatar Financial Center chief economic adviser Dr. Haitham al-Salama forecast that prices are expected to be in the range of $55 to $60 a barrel.

Trade turnover and volumes were however on the decline during the week which saw banking, real estate and telecom sectors together constituted about 79% of the total volumes.

In volumes, banks and financial services sector constituted 40% of the total, followed by realty (24%), telecom (15%), industrials (9%), consumer goods (5%) and transport (4%) and insurance (2%) during the week which saw which saw industrials, real estate and telecom register faster shrinkage in trade volumes and value.

In value, banks and financial services’ share was 54%, followed by industrials (15%), real estate (13%), telecom (6%), consumer goods (5%), and insurance and transport (4% each) during the week, which saw Masraf Al Rayan dominate the trading ring in volumes and value.

Opening the week strong at 10,272 points on Monday (Sunday being national holiday), the market shot up on the second day on reports of banks’ merger proposal, after which there was mild profit booking on Wednesday. The market witnessed further strengthening on the last day and overall the index reported 204 points gains during the week.

The 20-stock Total Return Index rose 1.99%, All Share Index (comprising wider constituents) by 1.87% and Al Rayan Islamic Index by 2.46% during the week which featured a report from Samba Financial Group that said excess deposits by Qatar’s banks at the Qatar Central Bank increased to $2.6bn in September from $1.9bn in August.

Banks and financial services sector saw its index vault 3.24%, telecom (2.91%), transport (1.45%), industrials (1.19%), consumer goods (1.1%) and realty (0.88%), while insurance fell 1.18% during the week.

Market capitalisation expanded more than QR11bn or 2.01% to QR562.09bn with large, mid, small and microcap equities gaining 2.37%, 0.94%, 0.87% and 0.11% respectively during the week.

Small, mid and microcap stocks have nevertheless reported year-to-date losses of 12.63%, 6.63% and 4.36% respectively, while large caps gained 2.48%.

Of the 44 stocks, as many as 26 gained, while 16 fell and one was unchanged. Another one was not traded. As many as eight of the 13 banks and financial services, five each of the nine consumer goods and the eight industrials, three of the five insurers, two each of the four realty and the three transport and one of the two telecom stocks settled higher during the week.

More than 60% of the stocks extended gains with major movers being Masraf Al Rayan, QNB, Qatar Islamic Bank, Ooredoo, Industries Qatar, Qatari Investors Group, Barwa, Milaha and Gulf Warehousing during the week.

Nevertheless, Qatar Insurance, Qatar Electricity and Water, Qatar First Bank, Mazaya Qatar, Medicare Group, Islamic Holding Group and United Development Company were among the losers during the week.

Domestic institutions turned net buyers to the tune of QR76.84mn compared with net sellers of QR3.1mn the week ended December 15.

Non-Qatari individual investors’ net profit booking declined to QR3.55mn against QR20.22mn the previous week.

However, local retail investors’ net selling strengthened perceptibly to QR148.58mn compared to QR115.93mn the previous week.

Foreign institutions’ net buying fell substantially to QR75.18mn against QR139.24mn the week ended December 15.

Total trade volume fell 43% to 31.29mn shares, value by 32% to QR1.11bn and transactions by 30% to 15,229 during the week.

The industrials sector reported 64% plunge in trade volume to 2.85mn equities, 54% in value to QR164.48mn and 31% in deals to 3,148.

The telecom sector’s trade volume plummeted 55% to 4.79mn stocks, value by 60% to QR70.8mn and transactions by 55% to 1,026.

The real estate sector witnessed 49% shrinkage in trade volume to 7.43mn shares, 45% in value to QR141.92mn and 36% in deals to 2,385.

The insurance sector’s trade volume tanked 31% to 0.74mn equities, value by 35% to QR39.37mn and transactions by 26% to 495.

The banks and financial services sector saw 30% decline in trade volume to 12.65mn stocks, 11% in value to QR599.69mn and 25% in deals to 6,165.

The transport sector’s trade volume was down 10% to 1.14mn shares, while value was up 2% to QR42.42mn. Transactions fell 7% to 835.

However, the market witnessed 18% surge in the consumer goods sector’s trade volume to 1.68mn equities but on 19% fall in value to QR50.14mn and 24% in deals to 1,175.

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

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