Week ended Oct 05, Week ended Sep 28, Chg. % Market Indicators

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1 ` Market Review and Outlook The Qatar Stock Exchange (QSE) Index decreased by points or 2.17% during the trading week to close at 8, Market capitalization decreased by 2.4% to QR443.7 billion (bn) versus QR454.6bn at the end of the previous trading week. Of the 45 listed companies, 7 companies ended the week higher, while 35 declined and 3 remained unchanged. Gulf Warehousing Co. (GWCS) was the best performing stock for the week with a gain of 2.1% on 76,604 shares traded. On the other hand, Ezdan Holding Group (ERES) was the worst performing stock for the week with a decline of 12.9% on 4.5 million (mn) shares traded. Masraf Al Rayan (MARK), Barwa Real Estate Co. (BRES) and Doha Bank (DHBK) were the primary contributors to the weekly index decline. MARK was the biggest contributor to the index s weekly decline, erasing 40.6 points from the index. BRES was the second biggest contributor to the decrease, shaving off 24.5 points from the index. Moreover, DHBK deleted 17.9 points from the index. Alternatively, Qatar Islamic Bank (QIBK) contributed positively to the index, adding 5.8 points to the index. Trading value during the week decreased by 33.9% to reach QR824.2mn versus QR1.25bn in the prior week. The Banks and Financial Services sector led the trading value during the week, accounting for 48.1% of the total trading value. The Industrials sector was the second biggest contributor to the overall trading value, accounting for 17.1% of the total trading value. QNB Group (QNBK) was the top value traded stock during the week with total traded value of QR221.7mn. Trading volume decreased by 32.3% to reach 38.5 shares versus 56.9mn shares in the prior week. The number of transactions fell by 32.8% to reach 10,550 transactions versus 15,702 transactions in the prior week. The Banks and Financial Services sector led the trading volume, accounting for 25.7%, followed by the Telecom sector which accounted for 24.8% of the overall trading volume. Vodafone Qatar (VFQS) was the top volume traded stock during the week with 9.0mn shares. Foreign institutions turned bullish with net buying of QR10.0 vs. net selling of QR86.4mn in the prior week. Qatari institutions remained bullish with net buying of QR14.8mn vs. net buying of QR23.4mn the week before. Foreign retail investors turned bearish with net selling of QR7.5mn vs. net buying of QR3.0mn in the prior week. Qatari retail investors turned bearish with net selling of QR17.3mn vs. net buying of QR60.0mn the week before. In 2017 YTD, foreign institutions bought (on a net basis) ~$612mn worth of equities. QSE Index and Volume 8,350 8,175 8,000 Market Indicators Week ended Oct 05, 2017 Week ended Sep 28, 2017 Chg. % Value Traded (QR mn) ,247.7 (33.9) Exch. Market Cap. (QR mn) 443, ,612.2 (2.4) Volume (mn) (32.3) Number of Transactions 10,550 15,702 (32.8) Companies Traded (2.2) Market Breadth 7:35 23:21 Market Indices Close WTD% MTD% YTD% Total Return 13, (2.2) (2.2) (19.2) ALL Share Index 2, (3.2) (3.2) (20.0) Banks and Financial Services 2, (2.0) (2.0) (12.4) Industrials 2, (1.3) (1.3) (23.5) Transportation 1, (2.7) (2.7) (33.7) Real Estate 1, (9.6) (9.6) (28.8) Insurance 3, (3.5) (3.5) (27.0) Telecoms 1, (0.9) (0.9) (15.5) Consumer Goods & Services 4, (3.2) (3.2) (16.4) Al Rayan Islamic Index 3, (2.6) (2.6) (15.1) Market Indices Weekly Index Performance 2.0% 1.0% 0.0% (1.0%) (2.0%) (3.0%) 8, , , , Oct 2-Oct 3-Oct 4-Oct 5-Oct Volume QSE Index 1.5% 0.8% 0.4% 0.0% Oman Dubai Abu Dhabi Saudi Arabia (0.3%) Kuwait (0.7%) Bahrain 8, (2.2%) Qatar (QSE)* 10,000,000 5,000,000 0 Regional Indices Close WTD% MTD% YTD% Weekly Exchange Traded Value ($ mn) Exchange Mkt. Cap. ($ mn) TTM P/E** P/B** Dividend Yield Qatar (QSE)* 8, (2.2) (2.2) (22.1) , Dubai 3, ,550.0 # Abu Dhabi 4, (2.9) , Saudi Arabia # 7, , , Kuwait 6, (0.3) (0.3) , Oman 5, (9.8) , Bahrain 1, (0.7) (0.7) , Source: Bloomberg, country exchanges and Zawya (** Trailing Twelve Months; * Value traded ($ mn) do not include special trades, if any; # Data as of October 4, 2017) Page 1 of 7

2 News Economic & Corporate News QCB Governor: Qatar has enough reserves to support banks despite blockade Qatar, blockaded by three of its Gulf neighbors since June, is capable of supporting its banks with assets in the country s vast sovereign wealth fund and foreign currency reserves, According to Qatar Central Bank s (QCB) Governor, HE Sheikh Abdullah Bin Saoud Al Thani. Stress tests routinely conducted by Qatar s central bank show the strength and efficiency of Qatari banks in the face of the arbitrary measures imposed by the siege countries, QCB s Governor said. Qatar is spending heavily to support its banks and defend the currency s peg to the US Dollar. The government and the central bank are able to support banks with the holdings of the large sovereign wealth fund and the large state reserves, Lusail news service quoted Sheikh Abdullah as saying. The central bank posted excerpts from the report on its website. Sheikh Abdullah said banks should only consider the government and the central bank supplies of funds as the last resort, implying that they must first seek other sources of financing. (Gulf-Times.com) Al Shaibei: Qatari banks remain solid and strong Qatari banks have proved they remained solid and strong, despite the siege laid on the country by the quartet of nations, according to Qatar International Islamic Bank s (QIIK) Chief Executive Officer, Abdulbasit Ahmad Al Shaibei. The siege on our country has caught us by surprise. In the banking sector, we always have the risk assessment for different scenarios. However, we never thought we will be blockaded by our own brothers, Al Shaibei told Gulf Times in an interview. From the beginning, it (blockade) was a surprise to us to the international community. But by God s grace, and with the contingency plan the Qatar Central Bank and the banks had in place, we managed to overcome the problem in a short time and its tackle negative impacts, Al Shaibei stated. (Gulf- Times.com) Sukuk depends on market conditions, says QIIK CEO Qatar International Islamic Bank (QIIK) will issue a new Sukuk in place of an existing Sukuk that expires on October 18, only if the market conditions are good, according to QIIK s Chief Executive Officer, Abdulbasit Ahmad Al Shaibei. We are now testing the market. If the pricing is good, we will issue a new Sukuk... otherwise, we will wait until the right time in the international market, Al Shaibei said. However, Al Shaibei noted that QIIK does not have to go in for the Sukuk as it is very liquid. If the market conditions are good, the pricing is good; we will proceed with the Sukuk. Currently, there are lots of uncertainties in the international financial markets, especially in Europe and in Spain. We have to take into consideration the conditions in the international market while deciding to issue the Sukuk. QIIK already has its shareholder approval to issue Sukuk up to $2bn. (Gulf-Times.com) Qatar s strategic sectors attract foreign investors As Qatar accelerates the pace of its economic diversification, more foreign companies and investors are exploring opportunities in the country. Many of them are looking for opportunities in the food, manufacturing and downstream industries. Economic reforms, business friendly environment, and attractive taxation policies have made Qatar as one of the most favorite destinations for investors, according to a top official of the Qatar Chamber (QC). QC s Honorary Treasurer, Ali Bin Abdulateef Al Misnad said, The opening of the mammoth world-class Hamad Port, rapidly expanding Qatar Airways, massive public investments in infrastructure development, industrial parks, warehousing complexes and scores of other mega projects have put Qatar on the spotlight of global investors. (Peninsula Qatar) IIF: Liquidity injection eases Qatari banks funding pressure The Qatar Central Bank s (QCB) liquidity injection into the local banks and increased public sector deposits have mitigated the impact the banks funding pressure in recent months. The public sector deposits in Qatari banks (estimated now at $80bn) grew by 70% from May to August 27, more than offsetting the decline in non-resident deposits, the Institute of International Finance (IIF) noted. The IIF, in its Emerging Market (EM) fund flow report, mentioned non-resident deposits in Qatari banks fell from $51bn in May to $41bn in August 2017 in contrast to an estimated 60% increase in the first five months of Non-resident deposits in Qatar accounted for 19% of total bank deposits in August. The IIF s fund flow report noted, We believe that further declines in non-resident deposits will be limited. Meanwhile, the authorities in Qatar have taken steps to boost bank liquidity. Non-resident capital flows to EMs are projected to rise to $1.1tn in 2017 and $1.2tn in (Peninsula Qatar) Qatar s food services sector set to perform exceptionally well, says Al Masah Capital Qatar s food services sector is expected to perform exceptionally well with Qatar s casual dining scene, gaining prominence in a highly competitive market, Al Masah Capital noted the GCC s foodservice market will top $29bn by The GCC foodservice market is now firmly placed on a growth trajectory with its value expected to grow at a compound annual growth rate (CAGR) of 8% Al Masah Capital stated. The market totaled $21.5bn last year. The GCC food services sector is headed for further growth with key indicators such as a growing population and tourism sector, disposable income, and changing dietary habits continuing to shore up demand for food and dining options despite sluggish economic condition, the report noted. This growth, the report indicates, will largely be driven by a ballooning middle-class and increased penetration by international and local retail outlets across the GCC region. (Gulf-Times.com) Qatar banks register double-digit growth in realty sector loans in August Qatar's realty sector seems to be going in full steam despite the Gulf crisis as robust expansion in loans to this sector mainly led the country's commercial banks register a healthy double-digit growth YoY in domestic credit off-take this August. The total domestic credit by commercial banks grew more than 14% to QR805.17bn in August this year, according to the latest figures released by the Qatar Central Bank. The credit to the real estate sector witnessed more than 10% growth to QR187.01bn, which accounted for 23% of total credit in August It was the third largest recipient of loans in absolute terms. Defying the expectations of the siege Page 2 of 7

3 countries, Qatar's construction sector seems to display resiliency with sources viewing that the country's swift actions to diversify the trade partners helped ease uncertainties, which by itself was a supporting factor for the lenders. Loans to government were the second largest component or 21% of the banks' credit portfolio. It reported the fastest annual growth of more than 72% to QR172.31bn. The credit to services sector, the second largest group with a share of 22% in the total credit, was up more than 2% to Q170.64bn. (Gulf-Times.com) KPMG readiness index: Qatar ranks 19 out of 136 countries Qatar ranked 19th out of 136 countries globally for its capacity to respond and adapt to significant change, resulting from short-term events, such as natural disasters, and longer-term demographic, economic, social and technological trends, according to the findings of a latest study by KPMG. Qatar is one of only four Asian countries to feature in the top 20 in the Change Readiness Index (CRI), which is largely dominated by European countries, making up over half. Switzerland took the number-one ranking for the first time, replacing Singapore, which had claimed the top ranking in the 2013 and 2015 CRIs. The 2017 KPMG Change Readiness Index provides deep insights into where countries can focus and invest in order to be prepared for the increasing pace of change worldwide breaking down each country s capacity across three key pillars of capability: enterprise, government, and people & civil society. (Peninsula Qatar) Qatari economy set to continue strong momentum After the initial wobble, Qatari economy is fast adjusting to the impacts of capricious blockade imposed on it by the quartet Arab countries. The National Bank of Kuwait (NBK) said that both Qatari imports and exports rebounded to the pre-crisis levels. The Qatari economy has begun to normalize after the initial shock from the embargo imposed by some of its GCC neighbors. After plunging by around one-third in the months following the blockade, the value of Qatari goods imports rebounded by 39% MoM in July to QR8.7bn, taking them back close to precrisis levels. Exports also rebounded, albeit after a more modest post-embargo fall, NBK said. (Peninsula Qatar) Hamad Port s shipping costs drop 31% since blockade Operations at Hamad Port helped bring down shipping costs by 31% despite an economic blockade imposed on Qatar by three of its Gulf neighbors, according to SAK Holding Group. Freight prices at the beginning of the blockade were pegged at $1,700 for a 40-foot container. Shipping costs dropped by 31% to $1,300. (Gulf-Times.com) Qatar's non-oil exports exceed pre-siege level The total value of Qatar's non-oil exports in August 2017 reached QR1.796bn compared to QR1.328bn in July, recording an increase of 35.2% and to QR1.493bn in August 2016 recording an increase of 20.3%, according to the monthly report of the Qatar Chamber on the foreign trade of the private sector. The report, which was prepared, based on certificates of origin issued by Qatar Chamber's Research & Studies Department and Member Affairs Department, pointed out that 2819 certificates of origin were issued during the same month. The report noted that Qatar's non-oil exports during August were distributed to about 58 countries compared to 59 last month. (Peninsula Qatar) Industrial production index rises by 0.8% The index of industrial production rose by 0.8% in July 2017 to points, compared to the previous month (June 2017); however, decreased by 2.4% compared to the corresponding month in 2016, QNA reported. The industrial production index, released by the Ministry of Development Planning and Statistics, consists of three main components including mining with a relative importance of 83.6%, manufacturing with a relative importance of 15.2%, electricity with a relative importance of 0.7%, and water with a relative importance of 0.5%. In the manufacturing sector, a rise of 4.5% was recorded in July 2017 from the previous month, as a result of higher production in seven groups including the beverage industry by 16.5%, the base metals industry by 12.6%, the food industry by 9.8%, the cement industry and other non-metallic mineral products by 6.1%, the refined petroleum products industry by 5.3%, the chemicals and chemical products industry by 3.4%, the rubber and plastics products industry by 2.8%, while there was a decline in production, in one group which is printing and copying of recorded media by 7.8%. (Peninsula Qatar) Qatar leads the world in government spending on projects Qatar has ranked first globally in government spending on projects and in terms of tax impact on business incentives, among other rankings that incentivize international investment, according to Abdulbasit Al Ajji, Director (Business Development and Investment Promotion) at the Ministry of Economy & Commerce. He was making a presentation at a roundtable hosted in honor of HE the Minister of Economy and Commerce Sheikh Ahmed Bin Jassim Al Thani by the US-Qatar Business Council (USQBC) and the US Chamber of Commerce in New York. Abdulbasit Al Ajji s, presentation emphasized on Qatar s economic strengths when stacked against the international community. In his remarks, Sheikh Ahmed focused on the strength of the Qatari economy in the face of current events. Further, he discussed the openness of the Qatari economy, especially as it pertains to international businesses. Sheikh Ahmed commended the work of the US- Qatar Business Council in promoting bilateral business relations between the US and Qatar. (Gulf-Times.com) Al Baker: Qatar Airways to see pre-blockade traffic volumes by year-end Qatar Airways, which has triggered expansion plans following the illegal blockade on the country by four Arab nations, is hopeful of seeing its traffic volumes at preblockade levels by the end of the current financial year, according to Group s Chief Executive, Akbar Al Baker. We have lost 10% of our passenger network and that much of our revenue generation due to the blockade, Al Baker said at a media event at the Boeing production facility at Everett, Washington recently. Asked how the blockade had impacted the national airline, Al Baker said, Let me be very honest yes, we are affected. However, we have triggered our expansion plans immediately, which we initially delayed due to the aircraft delivery issues. And now with this blockade, we have capacity that has been released and now we have already started our expansion. Qatar Airways recently said it has a host of exciting new destinations planned for the remainder of this year and 2018, including Canberra (Australia), Chiang Mai (Thailand) and Mombasa (Kenya). (Gulf-Times.com) Page 3 of 7

4 Qatar Stock Exchange Top Gainers Top Decliners 2.4% 0.0% 2.1% 1.6% -5.0% 0.8% 1.0% 0.8% 0.7% -10.0% -9.4% -8.7% 0.3% -11.5% -10.6% 0.0% Gulf Warehousing Qatar Industrial Manufacturing Qatar Islamic Bank Doha Insurance Industries Qatar -15.0% -12.9% Ezdan Real Estate Mannai Corp. Islamic Holding Group Qatar German Co. Gulf International for Medical Devices Services Most Active Shares by Value (QR Million) Most Active Shares by Volume (Million) QNB Group Vodafone Qatar Masraf Al Rayan Ezdan Real Estate Investment Holding group 0.0 Vodafone Qatar Investment Holding group Ezdan Real Estate Qatar First Bank QNB Group Investor Trading Percentage to Total Value Traded Net Traded Value by Nationality (QR Million) 100% 80% 60% 20.65% 19.43% 7.53% 8.44% 20.93% 19.14% Non-Qatari % 50.90% 53.00% (3) 20% Qatari 595 0% Buy Sell 592 Qatari Individuals Qatari Institutions (100) Non-Qatari Individuals Non-Qatari Institutions Net Investment Total Sold Total Bought Page 4 of 7

5 TECHNICAL ANALYSIS OF THE QSE INDEX Source: Bloomberg The index moved into a 5-year low territory and closed down by another 2.17% from the week before; now 8, The 8,000 level remains to be our main support level and the resistance level around the 10,000 mark. 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. Page 5 of 7

6 Company Name Price October 05 % Change WTD % Change YTD Market Cap. QR Million TTM P/E P/B Div. Yield Qatar National Bank (1.02) (18.46) 111, Qatar Islamic Bank (11.62) 21, Commercial Bank of Qatar (3.81) (9.54) 11, N/A Doha Bank (6.17) (19.26) 8, Al Ahli Bank (22.92) 5, Qatar International Islamic Bank (1.41) (19.60) 7, Masraf Al Rayan (3.50) (4.73) 26, Al Khalij Commercial Bank (5.26) (31.18) 4, Qatar First Bank 6.80 (5.03) (33.98) 1,360 N/A 0.8 N/A National Leasing (8.64) (25.46) 565 N/A Dlala Holding (0.47) (20.43) N/A Qatar & Oman Investment 7.86 (5.30) (21.01) Islamic Holding Group (10.59) (31.33) Banking and Financial Services 200,349 Zad Holding (3.74) (19.17) Qatar German Co. for Medical Devices 7.25 (9.38) (28.22) 84 N/A 1.2 N/A Salam International Investment 7.74 (2.03) (29.95) Medicare Group (1.84) , Qatar Cinema & Film Distribution (8.93) Qatar Fuel (0.65) (25.03) 9, Widam Food Co (2.22) (9.41) 1,109 N/A Mannai Corp (11.45) (21.25) 2, Al Meera Consumer Goods (2.38) (20.17) 2, Consumer Goods and Services 20,746 Qatar Industrial Manufacturing (9.01) 1, Qatar National Cement (16.87) 4, Industries Qatar (21.70) 55, Qatari Investors Group (7.89) (41.90) 4, Qatar Electricity and Water (0.11) (23.08) 19, Aamal 8.13 (4.47) (40.35) 5, Gulf International Services (8.70) (41.32) 3,392 N/A Mesaieed Petrochemical Holding (17.59) 16, Invesment Holding Group 7.80 (7.14) N/A 647 N/A Industrials 110,781 Qatar Insurance (3.27) (31.34) 14, Doha Insurance (23.08) Qatar General Insurance & Reinsurance (4.31) (20.64) 3, Al Khaleej Takaful Insurance (4.61) (36.21) Qatar Islamic Insurance (6.69) Insurance 19,128 United Development (4.57) (31.28) 5, Barw a Real Estate (4.71) (8.12) 11, Ezdan Real Estate 9.15 (12.86) (39.44) 24, Mazaya Qatar Real Estate Development 9.21 (7.62) (32.80) 1, N/A Real Estate 42,249 Ooredoo (18.66) 26, Vodafone Qatar 8.07 (5.06) (13.87) 6,822 N/A 1.5 N/A Telecoms 33,345 Qatar Navigation (Milaha) (1.97) (43.19) 6, Gulf Warehousing (22.14) 2, Qatar Gas Transport (Nakilat) (4.62) (34.78) 8, Transportation 17,119 Qatar Exchange 443,716 Source: Bloomberg Page 6 of 7

7 Contacts Saugata Sarkar, CFA Shahan Keushgerian Zaid al-nafoosi, CMT, CFTe Head of Research Senior Research Analyst Senior Research Analyst Tel: (+974) Tel: (+974) Tel: (+974) Mohamed Abo Daff QNB Financial Services Co. W.L.L. Senior Research Analyst Contact Center: (+974) Tel: (+974) PO Box Doha, Qatar Disclaimer and Copyright Notice: This publication has been prepared by QNB Financial Services Co. W.L.L. ( QNBFS ) a wholly-owned subsidiary of Qatar National Bank (Q.P.S.C.). QNBFS is regulated by the Qatar Financial Markets Authority and the Qatar Exchange. Qatar National Bank (Q.P.S.C.) 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 7 of 7