By Bashir Yusuf Kahlout
It was interesting to see Qatar Exchange (QE) revive this week after having approached the edge of abyss a week ago, although it is not up to safety. This happened after a political solution on Syria loomed large on the horizon after weeks of tension. The crisis revealed the dilemma faced by US President Barack Obama, who was hesitant whether to strike or wait until he gets more supporters. This reluctance was reflected on financial markets, including the QE, which began to go up a day and down another. A strong rise was seen on Tuesday.
The week did not witness any major developments except Al Ijarah Holding Company’s announcement of the launch of limousines service with women drivers for families and women. A news report by the Economics and Business Journal said that Arab banks might reduce distribution of profit to shareholders this year to meet Basel 3 requirements.
As a result of the political developments, the benchmark index increased to 414.9 points. The All-Share Index and the All Sector Indexes also increased. The total market capitalisation earned some QR20.3bn to about QR525.7bn.
The benchmark index rose 4.51 percent to reach 9619.8 points, and the all-shares index rose by 95.7 points or 4.11 percent to 2422.2 points. The performances were driven by the rise of stock prices in all sectors. The telecom sector index increased by 6.13 percent, followed by the real estate sector index which rose by 4.96 percent. The banking and financial institution index soared by 4.58 percent, followed by transport sector (4.49 percent), the consumer goods and services sector (3.59 percent), and the industrial sector (3.11 percent). The rise was the result of increase in the share prices of 40 companies.
The share prices of two companies, namely Qatar Cement Company and General Insurance remained unchanged, and there were no decreases in the price of their shares. The Investors Group scrip showed the highest rise by 12.20 percent, followed by Al Meera, which rose by 8.76 percent. Ooredoo share price increased by 6.64 percent, followed by Medicare (MCGS) up 6.17 percent, UDC (up 5.89 percent) and QNB share (up 5.79 percent).
In terms of liquidity, the total trading volume increased by 15.7 percent to QR1.70bn and the daily trading average increased to QR340.3m, compared with QR 294.1m the previous week. The total trading of the shares of six top companies amounted to QR844.9m, up by 49.7 percent of the total value. Industries Qatar topped the trading with QR259.2m, followed by UDC (QR208.8m). QNB’s value stood at QR127.9m, Al Rayyan’s share trading value was worth QR107.3m, Nakilat (QR73m) and Qatar Navigation (QR 68.7m).
The total market capitalisation increased by about QR20.3bn to reach QR525.7bn. Qatari individual investors bought stocks worth QR5.1m, while foreign individuals bought a net of QR42.3m against the net sales of Qatari portfolios with value of QR26m and non-Qatari portfolio of QR21.4m.
To sum up, the sharp rise in the index was mainly driven by the geopolitical developments. The index jump was associated with increase on shares of the major groups. As I mentioned the past week, the market will continue to remain volatile until the world leaders come out with a specific package to address the Syria issue.