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Market Review and Outlook QSE Index and Volume The Stock Exchange (QSE) Index gained 90.70 points, or 10,400 12,000,000 0.88% during the week to close at 10,376.2. Market capitalization 10,376.20 increased by 1.71% to QR554.0 billion (bn) versus QR544.7bn at 10,312.88 the end of the previous week. Of the 43 listed companies, 25 10,316.67 companies ended the week higher, while 17 fell and 2 remained 10,229.02 unchanged. Qatari Investors Group (QIGD) was the best 10,200 6,000,000 performing stock for the week with a gain of 44.9% on 3.7 million (mn) shares traded. On the other hand, Qatar International 10,145.39 Islamic Bank (QIIK) was the worst performing stock with a decline of 6.2% on 293,329 shares traded. The decline was due to 10,000 0 the stock going ex-dividend. 27-Mar 28-Mar 29-Mar 30-Mar 31-Mar Ooredoo (ORDS), Ezdan Holding Group (ERES) and Qatar Volume QSE Index Electricity & Water Co. (QEWS) were the primary contributors to Week ended Week ended Market Indicators Chg. % the weekly index gain. ORDS was the biggest contributor to the March 31 , 2016 March 24 , 2016 index’s weekly gain, adding 32.1 points to the index. ERES was Value Traded (QR mn) 1,847.0 1,933.3 (4.5) the second biggest contributor to the increase, contributing 29.1 Exch. Market Cap. (QR mn) 554,031.0 544,699.7 1.7 points to the index. Moreover, QEWS tacked on 23.5 points to the Volume (mn) 48.4 51.4 (5.9) index. On the other hand, Qatar Islamic Bank (QIBK) contributed Number of Transactions 25,810 26,356 (2.1) negatively to the index, shedding 21.5 points off the index. Companies Traded 44 44 0.0 Trading value during the week decreased by 4.47% to reach Market Breadth 25:17 18:24 – QR1.8bn versus QR1.9bn in the prior week. The Banks and Financial Services sector led the trading value during the week, Market Indices Close WTD% MTD% YTD% accounting for 40.0% of the total trading value. The Industrials Total Return 16,721.16 1.2 6.7 3.1 was the second biggest contributor to the overall trading value, All Share Index 2,881.97 1.8 7.3 3.8 accounting for 25.0% of the total trading value. QIGD was the top Banks/Financial Svcs. 2,793.40 0.1 4.3 (0.4) value traded stock during the week with total traded value of Industrials 3,219.29 4.4 8.2 1.0 QR194.2mn. Transportation 2,558.81 1.2 7.0 5.3 Trading volume decreased by 5.9% to reach 48.4mn shares versus Real Estate 2,525.36 2.2 12.6 8.3 51.4mn shares in the prior week. The number of transactions Insurance 4,479.49 (0.1) 6.2 11.1 decreased by 2.1% to reach 25,810 transactions versus 26,356 Telecoms 1,182.67 8.2 10.5 19.9 transactions in the prior week. The Banks and Financial Services Consumer 6,606.29 (0.2) 7.7 10.1 sector led the trading volume, accounting for 29.1%, followed by Al Rayan Islamic Index 4,061.95 3.0 11.2 5.3 the Industrials, which accounted for 22.0% of the overall trading Market Indices Weekly Index Performance volume. MARK was the top volume traded stock during the week with total traded volume of 5.1mn shares. 3.0% 1.4% 1.1% 0.9% Foreign institutions remained bullish during the week with net buying of QR212.8mn vs. net buying of QR168.6mn in the prior 0.0% week. Qatari institutions remained bearish with net selling of (0.8%) QR76.1mn vs. net selling of QR113.5mn the week before. Foreign (1.2%) (3.0%) retail investors remained bearish for the week with net selling of (2.1%) (2.4%) QR23.3mn vs. net selling of QR3.8mn in the prior week. Qatari

retail investors remained bearish with net selling of QR113.4mn

Oman Dubai

vs. net selling of QR51.3mn the week before. In 2016 YTD, foreign Kuwait

institutions bought (on a net basis) ~$193mn worth of Qatari Bahrain AbuDhabi

equities. SaudiArabia Qatar(QSE)*

Weekly Exchange Exchange Mkt. Regional Indices Close WTD% MTD% YTD% TTM P/E** P/B** Dividend Yield Traded Value ($ mn) Cap. ($ mn) Qatar (QSE)* 10,376.20 0.9 4.9 (0.5) 509.70 152,136.9 12.9 1.6 4.0 Dubai 3,355.53 1.1 3.6 6.5 498.39 88,304.3# 11.8 1.2 3.7 Abu Dhabi 4,390.42 1.4 0.9 1.9 237.92 124,189.9 11.4 1.4 5.6 Saudi Arabia# 6,215.65 (2.1) 2.0 (10.1) 6,736.10 382,494.9 14.3 1.5 4.2 Kuwait 5,228.75 (0.8) 0.4 (6.9) 303.60 79,865.8 14.7 0.9 4.9 Oman 5,467.42 (1.2) 1.3 1.1 57.04 22,113.0 12.4 1.2 5.0 Bahrain 1,131.10 (2.4) (4.0) (7.0) 5.70 17,789.3 8.7 0.6 5.0 Source: Bloomberg, country exchanges and Zawya (** Trailing Twelve Months; * Value traded ($ mn) do not include special trades, if any; #Data as of March 30, 2016)

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News

Market News  UDCD renews facilities contract with QNB Group – United  FTSE Russell reconfirms Qatar Exchange’s September upgrade – Development Company (UDCD) has renewed a credit facility Global Index provider FTSE Russell re-confirmed that Qatar agreement with QNB Group (QNBK) with a ceiling of QR728mn. would be upgraded from the Frontier to the Secondary Emerging UDCD said it was decided after recommendations by its finance market. Announcing the results of its March 2016 country department on the credit facility agreement, signed with QNB classification interim review, the index provider stated “effective Group, for the infrastructure of water and electricity at the Pearl- from September 2016, Qatar will be promoted from the Frontier Qatar island. Meanwhile, UDCD will disclose its 1Q2016 results on to the Secondary Emerging. Latvia and Palestine, previously April 25, 2016. (QSE) ‘unclassified’, will be designated as the eligible Frontier markets  CEO: QIIK plans additional Tier 1 Sukuk up to QR3bn before April- within the FTSE Country classification scheme.” FTSE announced end – Qatar International Islamic Bank (QIIK) CEO Abdulbasit A its decision to upgrade Qatar for the first time in September 2015. al-Shaibei has said that the bank is planning to issue additional It said the upgrade will be implemented over two equal tranches Tier 1 Sukuk up to QR3bn before April-end. He said besides in September 2016 and March 2017. (Peninsula Qatar) supporting the bank’s Tier 1 capital in accordance with the Basel  QCSD amends KCBK foreign ownership ratio – The Qatar Central III requirements, the Sukuk will support QIIK’s ability to finance Securities Depository (QCSD) amended the foreign ownership and improve its capital ratio. Al-Shaibei said, “Our capital ratio is percentage in the shares of Al Khalij Commercial Bank (KCBK). now 17%. With Tier 1, it will go up to 22% or even more.” At its The new ratio will stand at 49% of the company’s capital as of AGM held at the Ezdan Tower, the bank’s shareholders “approved March 27, 2016. This decision is issued pursuant to Law No. 9, renewal of the additional Tier 1 Sukuk issuance”. Meanwhile, the which allows non-Qatari investors to own shares amounting to no company is expecting final approval from the Moroccan more than 49% of the capital. The law also provides for the authorities for its joint venture bank in the Kingdom by 3Q2016. treatment of the GCC citizens as Qataris in terms of owning the (Gulf-Times.com) shares of the listed companies. This move followed by KCBK  DHBK to disclose 1Q2016 financial results on April 18 – Bank receiving approval from its general assembly to amend the (DHBK) will disclose its 1Q2016 financial results on April 18, Articles of Association (AoA) in line with the provisions of law 2016. (QSE) and the approval of the Ministry of Economy and Commerce on  MERS sees growth in 2016 amid low oil prices – Retail major, Al the amendment. (QSE) Meera (MERS) Deputy CEO Dr Mohamed Nasser Al-Qahtani  QFB expects QSE listing in April – Qatar First Bank (QFB) has said announced the company’s plans to increase its store count to 55 it expects regulatory approval for the listing of its shares on the across Qatar in the next two years as it sees further growth in Qatar Stock Exchange (QSE) towards the end of next month. QFB 2016 amid low oil prices. Speaking on the sidelines of MERS’s Chairman Abdulla bin Fahad bin Ghorab Al Marri said, “QFB is AGM, Al-Qahtani said expansion plans in 2016 “will bring further expecting the listing towards the end of April.” QFB is a boutique growth to the company.” Al-Qahtani added, “This year would be investment bank that offers financial advisory services. The firm 100% better as compared to 2015. MERS averages an annual provides corporate finance, private equity, mergers and growth of 15%, but in 2016, we are expecting more in light of the acquisitions, recapitalization, and restructuring advisory services. six new branches that would be opened in Qatar.” He said MERS It caters to real estate, basic materials, oil and gas, healthcare, and has a network of 45 branches, including four in Oman, “but the education sectors. QFB is expected to make a detailed disclosure company plans to continue its expansion and growth in 2016 and on its listing at the bank’s annual general meeting, scheduled to be beyond”. During the meeting, Chairman of the Board Abdulla bin held at La Cigale Hotel. (Peninsula Qatar) Khalid Al-Qahtani said 2015 witnessed the opening of nine new  Qatar to implement roaming rates cut from April 1 – Qatar is stores at Muraikh, Al Azizia, , Jeryan Nejaima, Thakhira, prepared to implement the first phase of the new regulation on Al Wakrah (South), Al Thumama, and Rawdat Ekdeem, reduced roaming charges within the GCC region for the benefit of in addition to MERS’ first mall branch in Gulf Mall. The chairman telecom consumers in Qatar and the rest of GCC member states. added that the 10 new stores contributed QR210.9mn to the The Communications Regulatory Authority (CRA) of Qatar has Group’s sales in 2015. Also, the Board of Directors said MERS’s coordinated with both service providers – Ooredoo (ORDS) and expansion plans include the setting-up of 14 new branches across Vodafone (VFQS) – to launch the new rates from April 1, as the country, as well as plans to open a new store in Oman in 2016. planned. Since the decision was announced last year, the CRA had (Gulf-Times.com) worked with the service providers and put in place the necessary  QGMD reports QR1.95mn net loss in 4Q2015 – Qatar German regulatory instructions and orders to ensure they had sufficient Company for Medical Devices (QGMD) reported a net loss of time to plan the implementation. Both service providers have QR1.95mn in 4Q2015 as compared to net loss of QR2.61mn in been supportive in complying with this regulation. 3Q2015. The company reported a lower QoQ net loss as revenue Implementation of this consumer-centric initiative is a direct jumped 81.1% QoQ (+109.8% YoY) to QR6.54mn. (QSE, QNBFS result of the decision by the GCC Ministerial Committee for Post, Research) Telecommunications, and Information Technology to reduce rates  ZHCD net profit surged 97.6% QoQ in 4Q2015 – Zad Holding for roaming, telephone calls, text messaging, and data services Company’s (ZHCD) net profit surged 97.6% QoQ to QR33.56mn in throughout the GCC countries. (Gulf-Times.com) 4Q2015. However, on a YoY basis net profit was down 3.3% in  ORDS subsidiary concludes sale of wi-tribe – Ooredoo (ORDS) 4Q2015. Total revenue for 4Q2015 amounted to QR320.2mn, announced that its subsidiary wi-tribe limited concluded the sale reflecting an increase of 21.6% QoQ. Meanwhile, ZHCD’s board of wi-tribe Pakistan to HB Offshore Investment Ltd for a cash has recommended distributing a cash dividend of QR4.00 per amount of around QR32.7mn in line with the carrying value of the share, which is equivalent to 40% of the nominal share value. asset. HB Group is well established within the (QSE, QNBFS Research) telecommunications sector in Pakistan, and is planning to expand further. (QSE)

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Qatar Stock Exchange

Top Gainers Top Decliners

0.0% 48.0% 44.9%

-1.6% 32.0% -2.0% -1.8%

-2.8% -3.2% 16.0% 13.6% -4.0% 10.8% 6.7% 5.7% -4.5%

0.0% Qatari Qatar Cinema Ooredoo Mesaieed Al Ahli Bank -6.0% Investors & Film Petrochemical Islamic Holding Qatar Islamic Qatar German Co. Qatar Islamic Milaha Group Distribution Holding Group Bank for Medical Insurance Company Devices

Source: Qatar Stock Exchange (QSE) Source: Qatar Stock Exchange (QSE)

Most Active Shares by Value (QR Million) Most Active Shares by Volume (Million)

210.0 194.2 6.0 180.2 5.1

147.4 4.4 139.9 4.1 140.0 129.5 4.0 3.7 3.3

2.0 70.0

0.0 0.0 Masraf Al Vodafone Barwa Real Qatari Mesaieed Qatari Masraf Al Barwa Real Islamic QNB Group Rayan Qatar Estate Investors Petrochemical Investors Rayan Estate Holding Group Group Holding Group Company

Source: Qatar Stock Exchange (QSE) Source: Qatar Stock Exchange (QSE)

Investor Trading Percentage to Total Value Traded Net Traded Value by Nationality (QR Million)

190 100% 16.14% 27.66% Non-Qatari 622 80% 17.51% 16.25% 811 60% 19.88% 15.76%

40% (190) 40.33% 46.47% 20% Qatari 1,225

0% 1,036 Buy Sell

Qatari Individuals Qatari Institutions (400) (200) - 200 400 600 800 1,000 1,200 1,400

Non-Qatari Individuals Non-Qatari Institutions Net Investment Total Sold Total Bought

Source: Qatar Stock Exchange (QSE) Source: Qatar Stock Exchange (QSE)

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TECHNICAL ANALYSIS OF THE QSE INDEX

Source: Bloomberg

The Index inched higher and gained 0.88% over this week vs the previous. Another small indecision candlestick was created for the week; this indecision comes at an important level (just below the 10,500 level). The vision on the possible direction of the next move remains vague; indicators are growing flatter by the week. The main weekly resistance level remains at 10,500; support at the 9,000 level.

DEFINITIONS OF KEY TERMS USED IN TECHNICAL ANALYSIS RSI (Relative Strength Index) indicator – RSI is a momentum oscillator that measures the speed and change of price movements. The RSI oscillates between 0 to 100. The index is deemed to be overbought once the RSI approaches the 70 level, indicating that a correction is likely. On the other hand, if the RSI approaches 30, it is an indication that the index may be getting oversold and therefore likely to bounce back. MACD (Moving Average Convergence Divergence) indicator – The indicator consists of the MACD line and a signal line. The divergence or the convergence of the MACD line with the signal line indicates the strength in the momentum during the uptrend or downtrend, as the case may be. When the MACD crosses the signal line from below and trades above it, it gives a positive indication. The reverse is the situation for a bearish trend. Candlestick chart – A candlestick chart is a price chart that displays the high, low, open, and close for a security. The ‘body’ of the chart is portion between the open and close price, while the high and low intraday movements form the ‘shadow’. The candlestick may represent any time frame. We use a one-day candlestick chart (every candlestick represents one trading day) in our analysis. Doji candlestick pattern – A Doji candlestick is formed when a security's open and close are practically equal. The pattern indicates indecisiveness, and based on preceding price actions and future confirmation, may indicate a bullish or bearish trend reversal.

Shooting Star/Inverted Hammer candlestick patterns – These candlestick patterns have a small real body (open price and close price are near to each other), and a long upper shadow (large intraday movement on the upside). The Shooting Star is a bearish reversal pattern that forms after a rally. The Inverted Hammer looks exactly like a Shooting Star, but forms after a downtrend. Inverted Hammers represent a potential bullish trend reversal.

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Price % Change % Change Market Cap. Company Name (March 31) WTD YTD QR Million TTM P/E P/B Div. Yield Qatar National Bank 140.80 1.29 (3.45) 118,226 10.5 1.9 2.5 Qatar Islamic Bank 103.60 (3.18) (2.91) 24,480 12.7 1.8 4.1 Commercial Bank of Qatar 41.65 0.12 (9.26) 13,604 10.9 0.9 7.2 Doha Bank 37.15 0.41 (16.52) 9,599 7.7 1.0 8.1 Al Ahli Bank 48.00 5.73 9.45 9,159 14.2 2.0 3.1 Qatar International Islamic Bank 67.20 (6.15) 4.51 10,172 13.0 1.8 6.0 Masraf Al Rayan 35.70 0.00 (5.05) 26,775 12.9 2.2 4.9 Al Khaliji Bank 17.35 2.06 (3.45) 6,246 10.0 1.0 5.8 National Leasing 16.60 (0.78) 17.73 821 N/A 0.8 3.0 Dlala Holding 19.01 1.44 2.81 540 N/A 1.6 N/A Qatar & Oman Investment 12.55 4.41 2.03 395 7.2 1.2 4.8 Islamic Holding Group 75.00 (4.46) (4.70) 425 57.9 4.8 2.0 Banking and Financial Services 220,442 Zad Holding 92.80 0.87 9.43 1,214 12.5 1.5 4.3 Qatar German Co. for Medical Devices 12.68 (2.84) (7.58) 146 N/A 1.4 N/A Salam International Investment 13.29 (0.08) 12.44 1,519 13.4 0.9 4.5 Medicare Group 108.00 (4.42) (9.47) 3,040 16.8 2.8 1.7 Qatar Cinema & Film Distribution 34.15 13.64 0.44 214 15.0 1.6 4.4 Qatar Fuel 155.50 (0.96) 13.86 14,184 11.3 2.0 4.9 Widam Food Co. 54.20 1.31 2.65 976 14.1 3.7 4.6 Al Meera Consumer Goods 207.00 (3.72) (5.91) 4,140 26.1 3.0 4.3 Consumer Goods and Services 25,433 Qatar Industrial Manufacturing 38.00 0.53 (4.64) 1,806 10.7 1.2 7.9 Qatar National Cement 87.00 1.28 (6.18) 5,169 11.2 1.8 4.2 Industries Qatar 108.30 0.37 (2.52) 65,522 14.7 1.9 4.6 Qatari Investors Group 59.40 44.88 57.56 7,385 29.3 3.1 2.1 Qatar Electricity and Water 210.00 5.53 (2.96) 23,100 15.4 3.1 3.6 Mannai Corp. 92.00 (0.86) (3.46) 4,197 7.9 1.7 5.4 Aamal 12.79 (0.85) (8.58) 8,058 13.4 1.1 7.4 Gulf International Services 36.30 0.55 (29.51) 6,746 8.4 1.7 2.8 Mesaieed Petrochemical Holding 19.10 6.70 -1.5 23,996 22.0 1.7 3.7 Industrials 145,977 Qatar Insurance 82.90 (0.12) 19.24 16,836 17.2 3.1 2.6 Doha Insurance 19.15 1.70 (8.81) 958 8.6 0.9 5.2 Qatar General Insurance & Reinsurance 49.45 0.00 6.45 4,327 4.7 0.7 2.8 Al Khaleej Takaful Insurance 26.55 (0.38) (12.95) 678 16.7 1.2 3.8 Qatar Islamic Insurance 69.60 (1.83) (3.33) 1,044 12.7 3.1 5.7 Insurance 23,842 United Development 19.69 1.49 (5.11) 6,972 10.1 0.6 7.6 Barw a Real Estate 36.20 3.43 (9.50) 14,086 4.6 0.8 6.1 Ezdan Real Estate 18.20 2.02 14.47 48,275 28.4 1.6 2.2 Mazaya Qatar Real Estate Development 14.06 (0.64) 3.96 1,550 13.9 1.1 1.9 Real Estate 70,884 Ooredoo 93.00 7.02 24.00 29,790 14.1 1.4 3.2 Vodafone Qatar 12.32 0.08 (2.99) 10,415 N/A 2.0 1.7 Telecoms 40,205 Qatar Navigation (Milaha) 91.50 (1.61) (3.68) 10,479 9.5 0.8 5.5 Gulf Warehousing 58.70 3.71 3.16 3,440 16.1 2.0 2.6 Qatar Gas Transport (Nakilat) 23.80 2.72 1.93 13,328 13.4 3.0 5.3 Transportation 27,247 Qatar Exchange 554,031

Source: Bloomberg

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Contacts

Saugata Sarkar Shahan Keushgerian Zaid al-Nafoosi , CMT, CFTe Head of Research Senior Research Analyst Senior Research Analyst Tel: (+974) 4476 6534 Tel: (+974) 4476 6509 Tel: (+974) 4476 6535 [email protected] [email protected] [email protected]

QNB Financial Services SPC Contact Center: (+974) 4476 6666 PO Box 24025 Doha, Qatar

Disclaimer and Copyright Notice: This publication has been prepared by QNB Financial Services SPC (“QNBFS”) a wholly-owned subsidiary of QNB SAQ (“QNB”). QNBFS is regulated by the Qatar Financial Markets Authority and the Qatar Exchange QNB SAQ is regulated by the Qatar Central Bank. This publication expresses the views and opinions of QNBFS at a given time only. It is not an offer, promotion or recommendation to buy or sell securities or other investments, nor is it intended to constitute legal, tax, accounting, or financial advice. QNBFS accepts no liability whatsoever for any direct or indirect losses arising from use of this report. Any investment decision should depend on the individual circumstances of the investor and be based on specifically engaged investment advice. We therefore strongly advise potential investors to seek independent professional advice before making any investment decision. Although the information in this report has been obtained from sources that QNBFS believes to be reliable, we have not independently verified such information and it may not be accurate or complete. QNBFS does not make any representations or warranties as to the accuracy and completeness of the information it may contain, and declines any liability in that respect. For reports dealing with Technical Analysis, expressed opinions and/or recommendations may be different or contrary to the opinions/recommendations of QNBFS Fundamental Research as a result of depending solely on the historical technical data (price and volume). QNBFS reserves the right to amend the views and opinions expressed in this publication at any time. It may also express viewpoints or make investment decisions that differ significantly from, or even contradict, the views and opinions included in this report. This report may not be reproduced in whole or in part without permission from QNBFS COPYRIGHT: No part of this document may be reproduced without the explicit written permission of QNBFS. Page 6 of 6