By Satish Kanady
DOHA: Qatari stocks closed higher yesterday recovering from the past two week’s steep losses. The benchmark index surged 2.71 percent to break the 10,000 mark before finishing at 10,174.80. Yesterday’s bounces followed a 1.02 percent slide in main index in the past week and 4.43 percent decline in the previous week.
Stocks kicked off the session higher, when the market opened after an extended weekend-holidays that left shares wider than usual moves. The surge was driven by sentiments, traders said.
The banking sector, which saw a number of key market movements in the past two days, rose 2.28 percent. QNB announced the acquisition of 99.81 percent stake in Finansbank in Turkey. Masraf Al Rayan and QIB jumped 5.13 percent and 2 percent, respectively. QIB had announced that it issued first-of-its-kind certificates of deposits for customers, individuals and business, in riyal and dollar, with different maturity dates.
On the QNB deal, Afa Boran, Head of Asset Management at Amwal and Credit Suisse’s former top rated Turkish equity analyst said: “Based on the announced price, QNB seem to have gotten a very good deal buying Finansbank at 0.82 PBV vs QNB’s own PBV of 2.0x. Closest comparable is CBQ’s acquisition few years ago of Alternatif Bank at 2.0x PBV. Naturally valuations are lower now after emerging markets sell off but from a long term strategy acquisition point of view, this is a very good time to buy”.
This, along with other acquisitions in Egypt and Africa will provide QNB good growth prospects particularly after Qatar’s investment projects and borrowing needs are reduced. “Key macro challenges are Turkish lira devalued 20 percent against dollar year to date and interest rates are higher now, but I think the discounted price paid should offset the difficult short term prospects,” he said.
Another boost for the market was QE’s formal announcement regarding the launch of ‘margin trading’ of 20 most liquid stocks listed on the QE. To add on, oil market recovered slightly yesterday after the global benchmark Brent touched a fresh 11-year low.
Large buy orders from local retail investors boosted total trade volume to over 11 million shares from the previous session’s five million shares. Total value jumped to QR346m from QR205m.
Powerhouse stock Industries Qatar (IQ) was up 3.07 percent. Vodafone soared 9.93 percent to lift the Telecom sector to 5.37 percent. Realty stocks Ezdan and Barwa rose 4.34 and 3.13 percent, respectively.
The Peninsula
