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Qatar - Market Review and Outlook

Majed Salah
By Majed Salah
7 years ago
Qatar - Market Review and Outlook

Ard, Islam, Mal, Salam , Takaful , Commenda

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  1. ` QSE Index and Volume Regional Indices Qatar (QSE)* Dubai Abu Dhabi Saudi Arabia# Kuwait Oman Bahrain Close WTD% MTD% YTD% 9,532.60 3,262.97 4,254.76 6,457.95 5,377.05 5,819.81 1,116.25 (1.9) (2.6) (0.7) (0.4) (0.4) (1.6) 1.6 (0.1) (1.5) 0.1 0.1 (0.4) 0.2 0.4 (8.6) 3.6 (1.2) (6.6) (4.2) 7.7 (8.2) 9,552.04 9,532.60 9,538.77 9,450 0 29-May 30-May 31-May 1-Jun Volume Market Indicators Value Traded (QR mn) QSE Index Week ended June 02 , 2016 1,047.2 Week ended May 26 , 2016 794.3 517,142.8 526,709.9 Exch. Market Cap. (QR mn) Volume (mn) Number of Transactions 31.8 (1.8) 26.3 22.0 19.8 16,217 (6.3) 43 44 (2.3) 4:38 10:33 – Market Breadth 2.0% Chg. % 15,193 Companies Traded Market Indices Total Return ALL Share Index Banks and Financial Services Industrials Transportation Real Estate Insurance Telecoms Consumer Goods & Services Al Rayan Islamic Index Market Indices Weekly Index Performance 2-Jun Close 15,423.11 2,672.29 2,585.29 2,983.11 2,442.84 2,340.82 4,084.17 1,040.31 6,390.17 3,721.77 WTD% (1.9) (1.8) (1.5) (2.5) (1.6) (1.2) (0.6) (4.0) (2.0) (2.3) MTD% (0.1) (0.1) (0.3) 0.2 (1.3) 0.2 1.8 (0.1) (0.6) (0.4) YTD% (4.9) (3.8) (7.9) (6.4) 0.5 0.4 1.3 5.5 6.5 (3.5) 1.6% 0.0% (0.4%) (0.4%) (0.7%) (1.6%) (1.9%) (4.0%) Weekly Exchange Traded Value ($ mn) 287.65 481.19 279.49 4,639.38 197.10 45.93 9.92 Exchange Mkt. Cap. ($ mn) 142,007.4 90,095.8# 112,950.4 394,673.5 81,272.4 23,137.9 17,626.4 (2.6%) Dubai (2.0%) Qatar (QSE)* Foreign institutions turned bearish during the week with net selling of QR21.6mn vs. net buying of QR3.7mn in the prior week. Qatari institutions turned bullish with net buying of QR16.3mn vs. net selling of QR17.5mn the week before. Foreign retail investors remained bearish for the week with net selling of QR22.8mn vs. net selling of QR2.8mn in the prior week. Qatari retail investors remained bullish with net buying of QR28.1mn vs. net buying of QR16.6mn the week before. In 2016 YTD, foreign institutions bought (on a net basis) ~$370mn worth of Qatari equities. 6,000,000 9,572.32 Oman Trading volume increased by 19.8% to reach 26.3mn shares versus 22.0mn shares in the prior week. The number of transactions decreased by 6.3% to reach 15,193 transactions versus 16,217 transactions in the prior week. The Banks and Financial Services sector led the trading volume, accounting for 31.9%, followed by the Industrials sector, which accounted for 20.5% of the overall trading volume. Vodafone Qatar (VFQS) was the top volume traded stock during the week with total traded volume of 3.2mn shares. 9,675.66 9,650 Abu Dhabi Trading value during the week increased by 31.8% to reach QR1.0bn versus QR794.3 million (mn) in the prior week. The Banks and Financial Services sector led the trading value during the week, accounting for 36.2% of the total trading value. The Industrials sector was the second biggest contributor to the overall trading value, accounting for 26.2% of the total trading value. QNBK was the top value traded stock during the week with total traded value of QR115.9mn. 12,000,000 Kuwait Industries Qatar (IQCD), QNB Group (QNBK) and Qatar Islamic Bank (QIBK) were the primary contributors to the weekly index decline. IQCD was the biggest contributor to the index’s weekly drop, shedding 27.9 points from the index. QNBK was the second biggest contributor to the decline, erasing 19.7 points from the index. Moreover, QIBK deleted 16.3 points from the index. On the other hand, Mazaya Qatar Real Estate Development Co. had the least amount of impact on the index. 9,850 Saudi Arabia The Qatar Stock Exchange (QSE) Index dropped by 183.88 points, or 1.89% during the week to close at 9,532.60. Market capitalization decreased by 1.8% to QR517.1 billion (bn) versus QR526.7bn at the end of the previous week. Of the 44 listed companies, 4 companies ended the week higher, while 38 fell and only 2 remained unchanged. Ahli Bank (ABQK) was the best performing stock for the week with a gain of 5.9% on 22,778 shares traded only. On the other hand, Medicare (MCGS) was the worst performing stock with a decline of 5.8% on 293,905 shares traded. Bahrain Market Review and Outlook TTM P/E** P/B** Dividend Yield 13.1 11.0 11.3 14.9 17.7 11.0 9.3 1.5 1.2 1.4 1.5 1.0 1.3 0.4 4.3 4.3 5.7 3.8 4.6 4.4 4.9 Source: Bloomberg, country exchanges and Zawya (** Trailing Twelve Months; * Value traded ($ mn) do not include special trades, if any; #Data as of June 01, 2016) Page 1 of 6
  2. News Economic News  Bank Audi: Qatar’s infrastructure development ‘largely unaffected’ by weak oil prices – According to Bank Audi, Qatar’s infrastructure development has so far remained “largely unaffected” by weak oil prices owing to its comfortable external buffer and that the country’s strengths outpace weaknesses and opportunities outweigh threats, suggesting a continuing favorable outlook for its economy. However, Bank Audi said persistently low oil prices would put the government under heightened pressure in 2016 and hence it is important for the policy makers to reduce the vulnerability to the slowdown in the hydrocarbon sector. Bank of Audi added that Qatar's inflation is set to harden owing to several factors, including fluctuation in the domestic gasoline and diesel prices, yet the country is committed to maintain fixed parity with the dollar as the present exchange rate regime offers stability and reassurance to investors. (Gulf-Times.com)  CBQK to hold investor meetings ahead of potential bond issue – Commercial Bank of Qatar (CBQK) has mandated Citi, HSBC, Morgan Stanley and National Bank of Abu Dhabi to arrange investor meetings ahead of a potential benchmark dollar bond issue. The meetings will be held in Asia, the Middle East and Europe from May 30. This may prompt the bank to issue a benchmark dollar bond as part of its $5bn Euro Medium Term Note (EMTN) program. Benchmark-sized typically means a bond of at least $500mn. (Reuters)  MRDS submits a preliminary offer to buy a property in Istanbul – Mazaya Qatar (MRDS) announced providing of an initial nonbinding offer to purchase a real estate asset for redevelopment in Istanbul Turkey. This offer came in line with the vision of the company to diversify the geographical presence and income source. (QSE)  QFBQ embarks on cost-cutting measures – Qatar First Bank (QFBQ) is undertaking a cost-cutting program, which includes “strategic” reduction of workforce, and exiting certain private equity investments, as it seeks to optimize its resources, enhance efficiency levels and revenues as well as to contribute positively to its shareholders. QFBQ Chief Executive Ziad Makkawi said, “In line with the current market conditions and in order for QFBQ to emerge as a more efficient and productive contributor to Qatar’s financial market, we have undertaken important cost rationalization initiatives touching upon both staffing and business related expenses.” (Gulf-Times.com)  QFBQ completes Leinster residential project in London – Qatar First Bank (QFBQ) announced the completion of Leinster Square residential real estate development in London. The project, which is QFBQ’s second completed development in London, offers shareholders and clients an opportunity to invest in five, three, and four bedroom townhouses and six lateral three bedroom apartments. The building benefits from southerly views and access to a private garden square, very rare in central London. (Gulf-Times.com)  UDCD signs MoU for sale of commercial tower – United Development Company (UDCD) signed a Memorandum of Understanding (MoU) for the sale of AQ-02 office tower, one of the two iconic commercial towers situated at the entrance of The Pearl-Qatar within the precinct of Abraj Quartier. (Peninsula Qatar)  KCBK BOD meets to discuss and approve various business related items – Al Khalij Commercial Bank (KCBK) announced that its Board of Directors will hold meeting on June 13, 2016 to discuss and approve various business related items. (QSE)  MERS Ramadan offer kicks off with 1,437 products – Al Meera Consumer Goods Company (MERS) announced the launch of its 1,437 consumer goods at cost price Ramadan offer, in celebration of the Islamic Year 1437. This campaign came as part of its unwavering commitment to offer the best to our consumer and honor the country’s social and cultural values. Starting from May 26, and until the end of Ramadan, patrons of 35 of Al Meera branches, in addition to Géant Hypermarket, will enjoy the chance to purchase, at cost price, 1,437 high quality products that have been carefully selected to cater to the specific needs of shoppers in the holy month. In addition to the 36 selected stores, Al Meera’s Residential complexes 1 and 2 in Thakhira, Beverly Hills 3, Kaaban, and Sealine branches will provide shoppers with “cost price” offers on the maximum number of consumer goods possible, as permissible by the stores’ space constraints. (QSE)  Mannai Trading Co. named distributor for Grundfos – Mannai Trading Co. has been appointed as the authorized distributor for Grundfos, a leading pump manufacturer, in Qatar. With this, Mannai Trading Co. will be responsible for the sales development of Grundfos products for the water utility and infrastructure sectors. Mannai is also authorized to serve the HVAC market with relevant Grundfos products and provide the warranty and service for all Grundfos pumps supplied in the above segments in line with the manufacturer’s standard terms and conditions. (GulfTimes.com)  Qatar’s property insurance may hit $1.8bn by 2019 – Property insurance in Qatar is expected to remain the highest in the nonlife insurance sector over the next couple of years and is likely to value $1.8bn by 2019. A report from Timetric predicts a bright future for property insurance in Qatar, fuelled by projected infrastructure spending ahead of the 2022 FIFA World Cup, and investment in the non-oil sectors in order to diversify the economy. (Bloomberg)  Fuel prices announced for June – Fuel prices in Qatar for June announced by the Ministry of Energy and Industry showed no major change from those fixed for this month. An announcement by the Ministry of Energy & Industry showed 91-octane Premium gasoline’s cost QR1.2/liter; while 95-octane Super gasoline’s cost as QR1.3/l. Diesel will remain unchanged for June at QR1.4/l. The fuel price in Qatar in May is as follows: gasoline (super 97) QR1.3/liter, gasoline (premium 90) QR1.15, and diesel QR1.40. The Ministry of Energy and Industry said fuel prices in Qatar were allowed to fluctuate in response to changes in the global market from May 1. Every month, a special committee comprising representatives from various government bodies, would review fuel prices (gasoline and diesel) and make recommendations on proposed prices for the local market accordingly. (GulfTimes.com)  Board of SIIS to study potential investment opportunities – Salam International’s (SIIS) Board of Directors will hold a meeting on June 20, 2016 to study some potential investment opportunities and follow up the execution of previous resolutions. (QSE)  ABQK appoints new deputy CEO for retail banking – Ahli Bank (ABQK) appointed Hassam Ahmed al-Efrangi as the Deputy Chief Executive Officer (CEO) of retail banking division. Al-Efrangi has been with the bank for 17 years and has held several positions, including his previous stint as the Head of Retail Services. (GulfTimes.com) Page 2 of 6
  3. Qatar Stock Exchange Top Gainers Top Decliners 0 .0% 7.5% 5.9% -3.0% 5.0% -4.1% 3.8% 3.3% -5.2% 2.5% 2.2% -6.0% -4.5% -4.8% -5.8% -9.0% 0.0% Al Ahli Bank Qatar General Insurance & Reinsurance Qatar Industrial Manufacturing Medicare Group Vodafone Qatar Dlala Holding Al Khaleej Takaful Insurance Gulf International Services Islamic Holding Group Source: Qatar Stock Exchange (QSE) Source: Qatar Stock Exchange (QSE) Most Active Shares by Value (QR Million) Most Active Shares by Volume (Million) 150.0 4.5 115.9 112.6 3.2 101.9 100.0 87.7 85.0 3.0 3.0 2.3 2.2 1.9 50.0 1.5 0.0 0.0 QNB Group Gulf International Services Qatar Islamic Qatar Insurance Industries Qatar Bank Investor Trading Percentage to Total Value Traded 41.15% 43.22% 80% 20% Qatar First Bank Ezdan Real Estate Masraf Al Rayan Net Traded Value by Nationality (QR Million) (44) 100% 40% Gulf International Services Source: Qatar Stock Exchange (QSE) Source: Qatar Stock Exchange (QSE) 60% Vodafone Qatar NonQatari 582 538 10.22% 20.23% 12.40% 18.68% 44 28.40% 25.71% Qatari 465 509 0% Buy Qatari Individuals Non-Qatari Individuals Source: Qatar Stock Exchange (QSE) Sell Qatari Institutions Non-Qatari Institutions (100) - 100 200 Net Investm ent 300 Total Sold 400 500 600 700 Total Bought Source: Qatar Stock Exchange (QSE) Page 3 of 6
  4. TECHNICAL ANALYSIS OF THE QSE INDEX Source : Bloomberg The QSE Index closed down by 1.89% at 9,532.60 vs the week before; the bearishness continued as it broke below 9,700 level. Technical indicators signal the possibility of the continuation of the bearish sentiment. The expected resistance level remains at 10,500 points and the support at 9,500 points. DEFINITIONS OF KEY TERMS USED IN TECHNICAL ANALYSIS RSI (Relative Strength Index) indicator – RSI is a momentum oscillator that measures the speed and change of price movements. The RSI oscillates between 0 to 100. The index is deemed to be overbought once the RSI approaches the 70 level, indicating that a correction is likely. On the other hand, if the RSI approaches 30, it is an indication that the index may be getting oversold and therefore likely to bounce back. MACD (Moving Average Convergence Divergence) indicator – The indicator consists of the MACD line and a signal line. The divergence or the convergence of the MACD line with the signal line indicates the strength in the momentum during the uptrend or downtrend, as the case may be. When the MACD crosses the signal line from below and trades above it, it gives a positive indication. The reverse is the situation for a bearish trend. Candlestick chart – A candlestick chart is a price chart that displays the high, low, open, and close for a security. The ‘body’ of the chart is portion between the open and close price, while the high and low intraday movements form the ‘shadow’. The candlestick may represent any time frame. We use a one-day candlestick chart (every candlestick represents one trading day) in our analysis. Doji candlestick pattern – A Doji candlestick is formed when a security's open and close are practically equal. The pattern indicates indecisiveness, and based on preceding price actions and future confirmation, may indicate a bullish or bearish trend reversal. Shooting Star/Inverted Hammer candlestick patterns – These candlestick patterns have a small real body (open price and close price are near to each other), and a long upper shadow (large intraday movement on the upside). The Shooting Star is a bearish reversal pattern that forms after a rally. The Inverted Hammer looks exactly like a Shooting Star, but forms after a downtrend. Inverted Hammers represent a potential bullish trend reversal. Page 4 of 6
  5. Price (Jun 02) % Change WTD % Change YTD Qatar National Bank 134.20 (1.32) (7.98) 112,684 9.8 1.9 2.6 Qatar Islamic Bank 92.20 (2.64) (13.59) 21,786 10.7 1.5 4.6 Commercial Bank of Qatar 35.60 (4.04) (22.44) 11,628 10.9 0.8 8.4 Doha Bank 34.80 (2.93) (21.80) 8,991 7.6 1.0 8.6 Al Ahli Bank 44.80 5.91 2.15 8,548 13.3 1.9 3.3 Qatar International Islamic Bank 60.50 (1.63) (5.91) 9,158 11.5 1.8 6.6 Masraf Al Rayan 32.75 (0.91) (12.90) 24,563 11.7 2.1 5.3 Al Khalij Commercial Bank 16.10 (2.42) (10.41) 5,796 9.1 0.9 6.2 Qatar First Bank 12.05 (0.41) N/A 2,410 N/A N/A N/A National Leasing 16.42 (2.84) 16.45 812 N/A 0.8 3.0 Dlala Holding 22.13 2.17 19.69 629 N/A 1.8 N/A Qatar & Oman Investment 10.94 (2.15) (11.06) 345 26.0 1.1 5.5 Islamic Holding Group Banking and Financial Services 63.30 (4.09) (19.57) 359 103.3 4.4 2.4 Zad Holding 86.00 0.00 Qatar German Co. for Medical Devices 11.79 (1.34) Salam International Investment 11.08 Medicare Group 98.00 Qatar Cinema & Film Distribution Com pany Nam e Qatar Fuel Widam Food Co. Al Meera Consumer Goods Consum er Goods and Services Market Cap. QR Million TTM P/E P/B Div. Yield 207,709 1,125 11.7 1.3 4.7 (14.07) 1.42 136 N/A 1.3 N/A (0.36) (6.26) 1,267 10.9 0.7 9.0 (5.77) (17.85) 2,758 19.0 2.8 1.8 32.50 0.00 (4.41) 204 15.2 1.6 4.6 151.50 (1.62) 10.93 13,819 11.0 2.1 5.0 58.10 (1.19) 10.04 1,046 13.4 3.6 4.6 204.00 (1.69) (7.27) 4,080 24.7 3.3 4.4 24,435 Qatar Industrial Manufacturing 41.30 3.25 3.64 1,963 10.6 1.4 7.3 Qatar National Cement 85.40 (2.06) (7.90) 5,074 11.0 1.7 4.3 Industries Qatar 95.20 (2.86) (14.31) 57,596 13.7 1.8 5.3 Qatari Investors Group 47.85 (3.92) 26.92 5,949 22.6 2.5 2.6 202.10 (1.32) (6.61) 22,231 14.8 3.2 3.7 Mannai Corp. 86.50 (3.89) (9.23) 3,946 8.0 1.7 5.8 Aamal 12.88 (2.13) (7.93) 8,114 12.8 1.1 N/A Gulf International Services 37.05 (4.51) (28.06) 6,885 13.1 1.8 2.7 Mesaieed Petrochemical Holding Industrials 18.20 (1.57) (6.19) 22,865 19.2 1.7 3.8 Qatar Insurance Doha Insurance 74.00 (1.33) 6.44 17,844 14.7 2.8 2.9 19.10 (1.09) (9.05) 955 8.8 0.9 5.2 Qatar General Insurance & Reinsurance 49.80 3.75 7.20 4,358 4.8 0.7 2.7 Al Khaleej Takaful Insurance 23.51 (4.82) (22.92) 600 20.0 1.1 4.3 Qatar Islamic Insurance Insurance 57.00 (2.40) (20.83) 855 12.0 2.9 7.0 United Development 18.12 (2.05) (12.67) 6,416 9.3 0.6 8.3 Barw a Real Estate 30.65 (1.45) (23.38) 11,927 26.2 0.7 7.2 Ezdan Real Estate 16.88 (0.94) 6.16 44,774 25.6 1.5 3.0 Mazaya Qatar Real Estate Development Real Estate 13.18 (3.23) (2.54) 1,453 13.0 1.0 N/A Ooredoo 82.30 (3.63) 9.73 26,362 10.6 1.2 3.6 Vodafone Qatar Telecom s 10.61 (5.18) 8,970 N/A 1.8 2.0 Qatar Navigation (Milaha) 85.70 (1.27) (9.79) 9,815 9.0 0.7 5.8 Gulf Warehousing Qatar Gas Transport (Nakilat) 57.80 (3.67) 1.58 3,387 15.7 2.5 2.6 22.85 (1.25) (2.14) 12,660 12.7 3.8 5.5 Qatar Electricity and Water Transportation Qatar Exchange 134,623 24,612 64,570 (16.46) 35,332 25,862 517,143 Source: Bloomberg Page 5 of 6
  6. Contacts Saugata Sarkar Shahan Keushgerian Zaid al-Nafoosi , CMT, CFTe Head of Research Senior Research Analyst Senior Research Analyst Tel: (+974) 4476 6534 Tel: (+974) 4476 6509 Tel: (+974) 4476 6535 saugata.sarkar@qnbfs.com.qa shahan.keushgerian@qnbfs.com.qa zaid.alnafoosi@qnbfs.com.qa QNB Financial Services Co. WLL One Person Company Contact Center: (+974) 4476 6666 PO Box 24025 Doha, Qatar Disclaimer and Copyright Notice: This publication has been prepared by QNB Financial Services Co. WLL One Person Company (“QNBFS”) a wholly-owned subsidiary of QNB SAQ (“QNB”). QNBFS is regulated by the Qatar Financial Markets Authority and the Qatar Exchange QNB SAQ is regulated by the Qatar Central Bank. This publication expresses the views and opinions of QNBFS at a given time only. It is not an offer, promotion or recommendation to buy or sell securities or other investments, nor is it intended to constitute legal, tax, accounting, or financial advice. QNBFS accepts no liability whatsoever for any direct or indirect losses arising from use of this report. Any investment decision should depend on the individual circumstances of the investor and be based on specifically engaged investment advice. We therefore strongly advise potential investors to seek independent professional advice before making any investment decision. Although the information in this report has been obtained from sources that QNBFS believes to be reliable, we have not independently verified such information and it may not be accurate or complete. QNBFS does not make any representations or warranties as to the accuracy and completeness of the information it may contain, and declines any liability in that respect. For reports dealing with Technical Analysis, expressed opinions and/or recommendations may be different or contrary to the opinions/recommendations of QNBFS Fundamental Research as a result of depending solely on the historical technical data (price and volume). QNBFS reserves the right to amend the views and opinions expressed in this publication at any time. It may also express viewpoints or make investment decisions that differ significantly from, or even contradict, the views and opinions included in this report. This report may not be reproduced in whole or in part without permission from QNBFS COPYRIGHT: No part of this document may be reproduced without the explicit written permission of QNBFS . Page 6 of 6