By Satish Kanady
DOHA: Qatari stocks rose 4.34 percent in February, after a volatile January pulled down the benchmark index by 9.09 percent. The index gained 411.02 points to finish at 9,892.32 points to end the month yesterday, 0.36 percent down from the previous session.
Industrial sector was the month’s value leader, accounting for 30.71 percent of the total traded value, followed by banks and financial services. Total trading value rose 30.11 percent to QR6.5bn in February. Volume increased by 31.93 percent. Market capitalisation rose 3.66 percent to reach QR525bn.
Gulf International, Masraf Al Rayan, Barwa Real Estate, Industries Qatar and QNB are the top gainers of the month. The value of Gulf International jumped 15.93 percent compared to the previous month. Masraf Al Rayan rose 8.06 percent month-on-month. Barwa was up 7.78 percent, while Industries Qatar and QNB gained 6.31 percent and 5.76 percent, respectively. “We believe it (QE) could trade with a positive bias in the short term. On the downside, it could find support at 9,820 and 9,650. Conversely, it could test 10,300 and 10,450 if it trades above 10,000,” analysts at Gulf Investment House (GIH) noted.
GIH analysts are bullish on Industries Qatar from a short-term perspective. “We believe it could advance in the near term and reach our price targets of QR113 and QR118. Traders could consider buying above QR109.50 and maintain a stop loss at QR105”.
“Regional markets are showing resiliency for the first time in a long time as they ride out another volatile week and preserve monthly gains..... Despite repeated attempts by sellers to increase pressure, buyers held their ground, allowing regional markets to gain on average 0.7 percent on the week. A positive average monthly gain has not happened since last April and given the carnage in January, it will be seen as a small victory,” Al Masah Capital, a leading alternative asset management and advisory firm in Dubai said in a note sent to The Peninsula.
February gains have been led by retailers, which tends to be the case in these markets and the buying has focused on smaller cap names which is what retailers focus on; hence market pessimists will deem this a weak foundation on which to build any momentum unless institutions and foreign money recommit significantly. However, with oil still volatile and a bottom far from in place, uncertainty still has the upper hand hindering fresh inflows. In the coming week the transition from February to March will be done with an eye on whether buyers can maintain the recent uplift.
Reuters’ monthly Fund Managers survey yesterday found Qatar has lost some favour with portfolio managers, as 14 percent now expect to raise allocations there and the same number to cut them. Last month, 43 percent expected to boost holdings in Qatar and 7 percent to reduce them.
Managers said forward stock price valuations in Qatar, especially in the banking sector, although cheap by historic measures, were looking slightly more expensive compared to their Gulf peers. Middle East fund managers have become more positive on Saudi Arabian equities after valuations dropped and because of signs that oil prices may be bottoming out, Reuters reported.The Peninsula
