JEDDAH, 15 May 2005 — Global Investment House, a leading Kuwait-based investment banker, is set to launch its new indices on Doha Securities Market from today. The move is part of Global’s series of indices, leveraging the need of tracking the performance of Qatari stocks in line with the opening of the Doha Securities Market to non-Qataris.
Omar M. El-Quqa, executive vice president at Global, said: “As Global persists on searching for and studying the major requirements that fulfill the needs of Gulf Cooperation Council (GCC) stock markets in general, we believe portfolio managers need more benchmarks to follow the flourishing Qatari stock market.
“Global has already highlighted the flourishing economy and financial situation that the Qatari market is currently witnessing. This development in the Qatari market attracted a lot of investors from all over the GCC.”
El-Quqa said the indices launch comes in line with the Doha Securities Market opening up to non-Qatari investors on April 3, and after implementation of the Law (2) for the year 2005, which regulates the investment of foreign capital into the economy.
He added, “The need for an index to act as a benchmark for portfolio managers interested in such stocks, in evaluating their performance has become necessary. Hence, Global composed a special index to track the performance of the Qatari market in general under the name of ‘Global Qatari General Index.’” Such an index should help in enhancing the market, as it will work side-by-side on developing the interest of foreign investors and direct them toward the Qatari stocks, he affirmed.
Global Indices at Doha Securities Market comprises all stocks listed on the Doha Securities Market. Besides the General Index, four sectors indices have been built to track the performance of each of the market sectors individually. They are: The Banking Index, Insurance Index, Industrial Index and Services Index. In the future, newly listed companies will be added under their related index on listing date to ensure that the index reflects the actual market conditions.
The index is maintained according to a transparent methodology that is consistent with International Finance Corporation (IFC) formula. It is a 100 percent market capitalization weighted index. The base value of both indices is 100, as on Dec. 31, 1999. Adjustments according to corporate actions are made as they occur. The market capitalization of Global Qatari Index is calculated in Qatari riyal.
Since the beginning of the current year up till April end, all market sectors managed to achieve a positive performance. This performance varied between different sectors. A huge increase was witnessed by the Industrial sector which outperformed the market index by 124.45 percent after achieving an increase of 160.84 percent in the first four months ending in April 2005. This increase is due to the noticeable increase achieved in the prices of all six companies listed under the industrial sector, compared to their 2004 year-end closing prices. For the same period, growth achieved by the banking, insurance and services sectors reached 56.95 percent, 39.28 percent and 28.08 percent respectively.
The industrial sector accounts for the highest percentage of market capitalization in the DSM, equivalent to 34.64 percent, followed by the banking sector with 32.42 percent of total market capitalization.
Investors will be able to track Global Indices of Doha Securities Market live during official trading days (Sunday-Thursday) on Reuters’ screens and Bloomberg. Also, historical performance since inception can be viewed on Global’s website: www.globalinv.net.
