Index settles at sub-10200 levels on profit booking, MSCI's rebalancing - The Libyan Report

Index settles at sub-10200 levels on profit booking, MSCI's rebalancing

The Qatar Stock Exchange plunged about 120 points this week, reflecting the global index compiler MSCI’s rebalancing and its appurtenant repercussions in the regional markets.

Profit booking pressure from foreign institutions and local retail investors had its toll as the 20-stock key barometer settled at sub-10,200 levels and capitalisation eroded about QR5bn this week which saw Qatar Financial Center chief executive Yousuf Mohamed al-Jaida view that international confidence in Qatar is high and Doha’s visibility and reputation on the world stage has been growing stronger.

Telecom and consumer goods counters witnessed higher than average selling pressure, leading to a 1.16% plunge in the 20-stock Qatar Index this week which saw Baladna Food Industries eye export markets like Libya, Kuwait, Jordan, Mauritania and Iraq as part of its international expansion strategy.

However, foreign institutions and non-Qatari individual investors were net buyers this week which saw global credit rating agency Fitch estimates Qatar's sovereign wealth fund's assets to remain large even under an adverse scenario involving a combination of significant further declines in oil prices, continued pressure on hydrocarbon production volumes, and weak financial returns.

More than 56% of the traded constituents were in red this week which saw six of the seven sectors reel under selling pressure.

Islamic stocks were seen declining slower than the main index this week which saw as many as 6,664 Masraf Al Rayan sponsored exchange traded funds QATR valued at QR16,003 trade across three transactions.

Trade turnover and volumes were on the increase this week which saw a total of 7,000 Doha Bank sponsored QETF valued at QR70,447 changed hands across five deals.

The Total Return Index shed 1.16%, Al Rayyan Islamic Index by 0.99% and All Share Index by 0.96% this week which saw Fitch affirm al khaliji’s long-term issuer default rating at ‘A’ with a “stable” outlook.

The telecom index tanked 3.05%, consumer goods (2.5%), banks and financial services (0.97%), insurance (0.86%), realty (0.72%) and industrials (0.5%); while transport gained 1.02% this week which saw Qatar General Insurance and Reinsurance sign an agreement with global consultant company Roland Berger as part of efforts to strengthen its operations.

Major losers included Ooredoo, Woqod, Commercial Bank, Qatar Islamic Bank, Qatar National Cement, Industries Qatar, Aamal Company, United Development Company and Qatar Insurance; even as Ahlibank Qatar, Gulf Warehousing, Al Khaliji, Qatar Oman Investment, Salam International Investment, Qatar Industrial Manufacturing, Mesaieed Petrochemical Holding and Qatar General Insurance and Reinsurance were among the gainers this week.

Market capitalisation fell 0.81% to QR562.18bn, mainly on large ad midcap equities this week which saw banking and industrials sectors constitute about 74% of the trading volume.

The banks and financial services sector accounted for 53% of the trading volume, industrials (21%), real estate (11%), telecom (5%), and consumer goods insurance and transport (3% each) this week.

In terms of value, banks and financial services accounted for 74%, industrials (10%), consumer goods (5%), telecom (4%), realty (3%), transport (2%) and insurance (1%) this week.

Non-Qatari funds were net sellers to the tune of QR44.43mn against net buyers of QR57.61mn the week ended November 21.

Local retail investors were also net sellers to the extent of QR4.08mn compared with net buyers of QR2.98mn the previous week.

However, domestic funds turned net buyers to the tune of QR35.59mn against net profit takers of QR71.5mn a week ago.

Non-Qatari individuals’ net buying increased perceptibly to QR12.92mn compared to QR10.8mn the previous week.

Total trade volume grew 42% to 378.62mn shares and value more than doubled to QR2.27bn on 53% increase in transactions to 39,298.

The banks and financial services sector’s trade volume soared 86% to 198.95mn equities and value almost tripled to QR1.67bn on 82% growth in deals to 21,740.

The transport sector reported 56% surge in trade volume to 12.16mn stocks, 70% in value to QR45.66mn and 8% in transactions to 869.

The insurance sector’s trade volume shot up 37% to 11.39mn shares, value by 31% to QR28.11mn and deals by 21% to 910.

There was 36% expansion in the industrials sector’s trade volume to 80.65mn equities, 97% in value to QR233.44mn and 32% in transactions to 6,694.

However, the telecom sector’s trade volume plummeted 19% to 20.53mn stocks, whereas value gained 60% to QR98.79mn and deals by 49% to 3,888.

The consumer goods sector reported 7% decline in trade volume to 12.48mn shares but on 8% growth in value to QR121.26mn and 7% in transactions to 3,117.

The real estate sector’s trade volume was down 7% to 42.26mn equities, while value shot up 44% to QR73.03mn and deals by 27% to 2,080. source