QNB Financial Services, the brokerage arm of the region’s largest lender Qatar National Bank, has expanded its business coverage to Saudi Arabia, Egypt and the United Arab Emirates because of increased interest in those markets among Qatari investors.
“We’ve expanded our coverage outside of Qatar as local investors have shown more confidence in equities,” Ahmed Shehada, head of trading at QNB Financial Services, told Reuters.
Dubai’s bourse surged more than 100 per cent last year while Saudi Arabia climbed 26 per cent. Egypt has rebounded 60 per cent from its June 2013 low, recovering to levels last seen before its 2011 revolution.
Qatar’s own equities benchmark surged 7.5 per cent last month, buoyed by expectations for strong government spending on infrastructure projects. QNB Financial Services accounted for 25 per cent of transactions in the Qatari market, the biggest share.
“There’s also been an influx of institutional buying in Qatar and the high activity has helped attract funds,” Shehada said.
Passive funds are set to flow into Qatar and UAE markets in May as MSCI’s upgrade of them to emerging market status takes effect. Some active funds have already increased positions since MSCI’s announcement in June 2013.
“The regional markets are running in different directions but UAE and Qatar are setting up for a rally until the MSCI upgrade takes place,” Shehada said.
Gulf brokerage firms have started to reverse a trend of cutting back staff and services that began with the 2008 financial crisis. The change is most visible in Dubai, where firms are expanding teams and restarting broker operations.