Qatar stocks open third quarter on strong note

DOHA: Qatar stock market opened the third quarter with a solid gain, yesterday. Driven by Industries Qatar (IQ), the bench mark index rose 1 percent or 90.2points to reach 9,114.23.

Among the sector indices, Industrials rose the most by 1.52 percent. The bellwether IQ led the pack by surging 2.80 percent. Market data showed Petrochemicals’ median product price for a basket of major products remained higher 27 percent YoY in June.

Spot prices for petrochemicals during June exhibited an uptrend on YoY.

Among the banking stocks, QNB rose 1.25 percent. Telecom sector was up by 0.86 percent, with Vodafone gaining 1.36 percent. QE Index ETF was up by 1.40 percent.

Qatar Stock Exchange’s (QSE) monthly data showed the benchmark index rose 1.62 percent in June compared to the previous month. During the month, trading value decreased by 25.57 percent and the trading value fell by 36.04 percent, as the number of total transactions fell by 27.27 percent.

Among the sector indexes, banks and financial services led the trading value in June, accounting for 61.7 percent of the total traded value, followed by industrials sector. The banks and financial sector also led the trading volume, accounting for 34.44 percent of the total volume. Market capitalisation rose by 0.39 percent at the end of June2018 to reach QR493bn.

The past week saw foreign institutions turning bullish with net buying of QR14.2m vs. net selling of QR38.9m in the previous week. Qatari institutions remained bearish with net selling of QR17.5m vs. net selling of QR2.3m in the week before. Foreign retail investors turned bearish with net selling of QR7.4m vs. net buying of QR0.4m in the prior week. Qatari retail investors remained bullish with net buying of QR10.8m vs. net buying of QR40.7m the week before. Foreign institutions bought (net basis) $1.7bn worth of Qatari equities YTD as on June 28.

Last week, Qatar Central Securities Depository (QCSD) announced that it had amended the foreign ownership percentage in the shares of Qatar Fuel Company (Woqod) to become 49 percent of the company’s capital, and the maximum shareholder ownership limit to 1 percent. In its ‘Qatar mid-year equity strategy 2018’, QNBFS said in longer-term, it remains optimistic on the Qatari equity market even after Foreign Ownership Limit (FOL) impact as fundamentals remain attractive.

QNBFS forecast a normalised 4.4 percent increase in aggregate earnings in 2018 followed by a more robust 2019 with 14.6 percent, in its coverage universe.

“Despite the issues related to the blockade, we highlight that we continue to expect Qatari equities to post ROE metrics for 2018 and 2019 that are in line with peers (11.4/12.2 percent vs. regional peer averages at 11.8/12.2 percent). Similarly, Qatari equities are expected to register dividend yields in line with peer average over the next 2 years at 4.6/4.9 percent vs. 4.7/5.0 percent”, QNBFS said.