Qatar Exchange Drops 4 Percent as Gulf Deadline Looms

Published July 3rd, 2017 - 09:10 GMT
Traders monitor screens displaying stock information at Qatar Stock Exchange in Doha on June 5, 2017. (Reuters)
Traders monitor screens displaying stock information at Qatar Stock Exchange in Doha on June 5, 2017. (Reuters)

Qatar’s bourse plunged as much as about 4 per cent during trade on Sunday as the deadline for Doha to accept a list of demands by four Arab countries loomed.

The Qatar Exchange (QE) index ended the day 2.31 per cent lower to reach 8,822.15 as most stocks fell, weighed down by uncertainty after Qatar effectively rejected the demands. The consumer goods and services gauge in the Qatari bourse was among the hardest hit, falling nearly 4 per cent, as the telecoms gauge slid 3.26 per cent. Meanwhile, the QE Al Rayan Islamic index dropped 3.82 per cent.

Lenders Masraf Al Rayan QSC and Qatar National Bank fell 2.3 per cent and 1.2 per cent, respectively, and Doha Bank dropped 4.9 per cent. Along with Qatar Islamic Bank, the companies represent about 40 per cent of the index.

The drop brings the QE index’s decline since the rift with the Arab countries started on June 5 to 11.1 per cent. In the year-to-date period, the index is down 15.5 per cent.

In early June, the UAE, Saudi Arabia, Bahrain, and Egypt announced they are severing diplomatic ties with Qatar amid escalating tensions over accusations that Doha sponsors terrorism. The group of four issued demands that included curbing ties with Iran, severing all ties to terrorist groups — specifically the Muslim Brotherhood, Daesh, Al Qaida, and Hezbollah — and shutting down Al Jazeera news organisation. Qatar was given 10 days to respond. They said the demands were non-negotiable, with those demands also including terminating Turkish military presence in Qatar.

Sunday’s loses erased most of the 2.9 per cent gains on the Qatar market on June 22, the last trading day in the market before it closed for a weeklong Eid Al Fitr holiday.

The four Arab states have since warned they may impose further sanctions if Qatar does not comply. They did not give details, but bankers believe, for example, that Saudi, UAE, and Bahrain banks might receive official guidance to pull deposits from Qatar, Reuters reported.

Elsewhere, Saudi Arabia’s Tadawul index rose 0.82 per cent to end the day’s trade at 7,486.31 as the index extended its winning streak after being shut for a week for holidays. The rise comes amid positive investor sentiment after index compiler MSCI said it would add Riyadh on a watch list for an emerging market status.

By Sarah Diaa

— With additional inputs from Reuters

 


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