By Satish Kanady
DOHA: Qatari stocks crashed by a sharp sell off yesterday that left the benchmark index 2.67 percent lower. This is the market’s biggest daily drop in five months, to 11,902 points.
Market watchers told The Peninsula the drop was not entirely surprising, given the way the bourse reacted to the first shocks of FIFA developments yesterday. Local institutional investors turned largely bearish.
The real estate stocks were battered by 7.11 percent. Ezdan was the worst performer. Its shares slumped 10 percent, the maximum allowed in a day. Telecoms plummeted 5.90 percent with Vodafone falling 9.04 percent and Ooredoo edging 4.64 percent down. Industrials tumbled 1.98 percent, as behemoth Industries Qatar lost 2.69 percent. Among the banking stocks, Commercial Bank was the worst hit. The shares of Commercial bank plunged 4.58 percent.
A whopping QR16bn washed away from the market in a single day as local investors exited from the market that brought down the market cap down to QR633bn. The whole week saw market cap shrinking by 4.26 percent.
“In fact a combination of factors sends investors racing for exits. Apart from FIFA worries, Qatar delivered two weak numbers in the past week. Global stocks are falling amid concerns about a possible Greek default. Adding to the woe is falling oil prices”, a market observer said.
The quarterly bulletin on foreign merchandise trade for the first quarter released by the Ministry of Development Planning and Statistics (MDPS) in the past week noted Qatar’s first quarter trade surplus balance declined by 50 percent from a year ago. Qatar’s monthly Producer Price Index (PPI) of the industrial sector data released by the Ministry on Wednesday suggested the country’s the PPI for March 2015, decreased by 41.4 percent on year-on-year basis.
QNB’s Investment Outlook released yesterday noted the positive correlation with oil price and political tensions in Yemen were the main reasons behind the weakness for the past few months in GCC Equity. QNB analysts believe GCC markets are oversold and the valuations are being attractive for some of these markets and there will be strong inflow in markets like Saudi that will be opening for foreign investors next month.
The Insurance sector was the lone sector which defied the trend yesterday. The sector rose 3.47 percent driven by Qatar Insurance. The shares of Qatar Insurance surged 5.10 percent. Of the 43 traded stocks, 32 declined yesterday and just 7 advanced, while four remained unchanged. Total traded volume spiked to 86 million from the previous session’s 23 million. Traded value jumped to QR2bn from QR841m.
Elsewhere in the region, Dubai’s index edged 0.2 up. Saudi Arabia’s main index was nearly flat as losses in the petrochemicals sector were offset by other stocks. Abu Dhabi index lost 1.3 percent to 4,517 point. Egypt’s index edged 0.6 percent down as Telecom Egypt tumbled 5.0 percent, Reuters reported.
The Peninsula
