Qatar Shares Rise to Highest in Three Weeks on Earnings Optimism, Oil Gain

Qatar’s shares rose to the highest level in more than three weeks on optimism third-quarter earnings will increase following government stimulus programs and after oil gained last week. Israel’s benchmark rallied.

Industries Qatar QSC (IQCD), the Middle East’s second-biggest petrochemicals company, rose 0.8 percent. Masraf Al Rayan, the country’s second-largest Shariah-compliant lender, advanced to the highest this month, lifting the Qatar Exchange Banking Sector Index 0.6 percent. The QE Index (DSM) climbed 0.5 percent to 8,437.61, the highest since Sept. 22, at the 1 p.m. close in Doha. The Bloomberg GCC 200 Index (BGCC200) slipped 0.2 percent, while Israel’s TA-25 Index surged 4.3 percent, the most since April 2009.

“We are positive on banks and industrial sectors” in Qatar, said Nabil Farhat, a partner at Abu Dhabi-based Al Fajer Securities. “The government has embarked on a spending program to stimulate the economy, and the central bank adopted an expansionary policy which is positive for economic growth and the stock market.”

Qatar, the host of the 2022 soccer World Cup and biggest exporter of liquefied natural gas, expects economic growth of about 16 percent in 2011. The country promised FIFA, world soccer’s governing body, to more than double hotel and apartment rooms to 84,000 and build a $25 billion rail and metro network. The central bank in August reduced its overnight lending rate and repurchase rate to 4.5 percent from 5 percent to boost spending on infrastructure and real-estate projects.

Third-Quarter Earnings

The basic salary and pensions of Qatari civilian employees were increased 60 percent as of Sept. 1, the state-run Qatar News Agency said last month.

Industries Qatar, the company with the second-heaviest weighting on the Persian Gulf country’s measure, gained to 127.1 riyals, the highest close since Sept. 21. The company said Oct. 12 third-quarter profit climbed 46 percent as sales rose and oil advanced. Masraf Al Rayan (MARK), which may post third-quarter results this week, climbed 0.7 percent to 24.88 riyals, the highest since Sept. 29.

Crude for November delivery surged 4.6 percent to $86.80 a barrel last week, a three-week high. Gulf Arab oil exporters, including the United Arab Emirates and Saudi Arabia, supply about a fifth of the world’s oil.

Israel’s Gain

Israel’s TA-25 Index jumped to 1,131.34 after Discount Investment Corp. (DISI) agreed to sell Shufersal Ltd. (SAE) and as Europe’s sovereign debt strategy got global backing. Discount surged 9.8 percent to 36.02 shekels and Shufersal rallied as much as 12 percent, the most in 13 years, to 18.40 shekels before closing at 17.1 shekels.

Israeli government bonds fell, with the yield on the benchmark 5.5 percent Mimshal Shiklit notes due January 2022 rising two basis points, or 0.02 percentage point, to 4.68 percent.

The DFM General Index (DFMGI) dropped 0.7 percent to 1,374.61, the lowest close since March 3. About 52 million shares traded in the emirate today, compared with this year’s daily average of 110 million shares. Abu Dhabi’s ADX General Index (ADSMI) slipped 0.3 percent.

Low volumes in the U.A.E. “will keep investors on the sidelines till liquidity improves,” said Sherif El Zeneiny, head of equity trading at National Bank of Abu Dhabi PJSC. “We would expect interest to return to selective U.A.E. names backed by any positive news from the eurozone in the coming weeks and any strong third-quarter numbers.”

Kuwait’s measure advanced 0.5 percent and Bahrain’s BB All Share Index rose 0.1 percent. Oman’s gauge increased 0.4 percent, while Saudi Arabia’s Tadawul All Share Index (SASEIDX) fell 0.5 percent after increasing 1 percent yesterday. In North Africa, Egypt’s EGX 30 Index (EGX30) rose for a fourth day, gaining 1.5 percent.

To contact the reporter on this story: Zahra Hankir in Dubai at zhankir@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

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