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QSE Intra-Day Movement

Qatar Commentary

The QSE Index fell 0.3% to close at 11,785.2. Losses were led by the Telecoms and Consumer Goods & Services indices, falling 2.0% and 1.4%, respectively. Top losers were Gulf International Services and Islamic Holding Group, falling 3.5% and 2.7%, respectively. Among the top gainers, Ahli Bank rose 4.3%, while Qatar Electricity & Water Co. was up 0.8%.

GCC Commentary

Saudi Arabia: The TASI Index fell 0.1% to close at 9,098.3. Losses were led by the Telecommunication & Information Technology and Hotel & Tourism indices, falling 2.0% and 1.8%, respectively. Malath Ins. fell 9.8%, while Walaa was down 5.5%.

Dubai: The DFM Index gained 0.3% to close at 4,143.2. The Transportation index rose 1.5%, while the Banks index gained 1.3%. Dubai National Insurance & Reinsurance rose 8.4%, while Gulf General Investment Co. was up 5.5%.

Abu Dhabi: The ADX benchmark index rose 0.3% to close at 4,834.2. The Energy index gained 1.4%, while the Real Estate index rose 1.3%. Abu Dhabi National Co. for B & M gained 9.5%, while Methaq Takaful Insurance Co. was up 6.8%.

Kuwait: The KSE Index gained 0.1% to close at 6,253.7. The Consumer Goods rose 1.7%, while the Consumer Services index gained 0.7%. Kuwait Cable Vision rose 8.1%, while Jeeran Holding Co. was up 8.0%.

Oman: The MSM Index rose marginally to close at 6,558.2. The Services index gained marginally, while the other indices ended in red. Dhofar Cattle Feed rose 5.0%, while Oman Investment & Finance was up 1.4%.

Bahrain: The BHB Index declined 0.1% to close at 1,331.7. The Investment index fell 0.4%, while the Services index was down 0.1%. Investcorp Bank fell 5.2%, while National Bank of Bahrain was down 0.7%.

QSE Top Gainers Close* 1D% Vol. ‘000 YTD%

Ahli Bank 50.50 4.3 16.8 1.7

Qatar Electricity & Water Co. 220.90 0.8 12.9 17.8

Qatar Islamic Bank 109.50 0.6 63.7 7.1

QNB Group 182.50 0.3 75.5 (14.3)

Widam Food Co. 61.60 0.3 0.2 2.0

QSE Top Volume Trades Close* 1D% Vol. ‘000 YTD%

Vodafone Qatar 15.73 (2.4) 782.9 (4.4)

Masraf Al Rayan 45.00 (0.1) 455.3 1.8

Ezdan Holding Group 17.55 0.2 370.4 17.6

Barwa Real Estate Co. 50.00 (0.8) 336.1 19.3

Gulf International Services 69.00 (3.5) 312.0 (28.9)

Market Indicators 30 Jul 15 29 Jul 15 %Chg.

Value Traded (QR mn) 193.8 212.8 (8.9)

Exch. Market Cap. (QR mn) 6,26,443.3 6,28,026.0 (0.3)

Volume (mn) 4.4 5.2 (14.8)

Number of Transactions 3,596 7,396 (51.4)

Companies Traded 41 42 (2.4)

Market Breadth 10:28 9:28 –

Market Indices Close 1D% WTD% YTD% TTM P/E

Total Return 18,318.43 (0.3) (1.3) (0.0) N/A

All Share Index 3,158.21 (0.3) (1.3) 0.2 13.0

Banks 3,121.33 0.3 (0.5) (2.6) 13.8

Industrials 3,754.04 (0.5) (1.3) (7.1) 13.2

Transportation 2,457.80 (0.7) (0.3) 6.0 12.6

Real Estate 2,700.44 (0.2) (2.2) 20.3 8.9

Insurance 4,776.03 (1.2) (2.1) 20.7 22.1

Telecoms 1,103.71 (2.0) (3.0) (25.7) 29.1

Consumer 7,315.96 (1.4) (2.7) 5.9 28.4

Al Rayan Islamic Index 4,612.87 (0.6) (1.4) 12.5 13.5

GCC Top Gainers## Exchange Close# 1D% Vol. ‘000 YTD%

IFA Hotels & Resorts Co. Kuwait 0.19 5.5 1.0 (4.0)

Ahli Bank Qatar 50.50 4.3 16.8 1.7

Co. for Coop. Insurance Saudi Arabia 109.09 4.0 613.3 118.4

Ithmaar Bank Bahrain 0.14 3.8 200.0 (15.6)

Dubai Islamic Bank Dubai 7.50 2.7 9,351.8 8.7

GCC Top Losers## Exchange Close# 1D% Vol. ‘000 YTD%

Saudi Telecom Co. Saudi Arabia 68.56 (4.8) 2,850.8 4.3

Gulf Cable & Elec. Ind. Kuwait 0.50 (3.8) 21.2 (27.5)

Gulf Int. Services Qatar 69.00 (3.5) 312.0 (28.9)

Abu Dhabi Nat. Hotels Abu Dhabi 2.90 (3.3) 39.2 (27.5)

Med. & Gulf Ins. Saudi Arabia 43.12 (3.3) 1,244.5 (13.9)

Source: Bloomberg (# in Local Currency) (## GCC Top gainers/losers derived from the Bloomberg GCC 200 Index comprising of the top 200 regional equities based on market capitalization and liquidity)

QSE Top Losers Close* 1D% Vol. ‘000 YTD%

Gulf International Services 69.00 (3.5) 312.0 (28.9)

Islamic Holding Group 132.20 (2.7) 45.4 6.2

Gulf Warehousing Co. 73.10 (2.5) 24.8 29.6

Vodafone Qatar 15.73 (2.4) 782.9 (4.4)

Medicare Group 186.60 (2.3) 5.7 59.5

QSE Top Value Trades Close* 1D% Val. ‘000 YTD%

Gulf International Services 69.00 (3.5) 21,734.7 (28.9)

Masraf Al Rayan 45.00 (0.1) 20,488.9 1.8

Barwa Real Estate Co. 50.00 (0.8) 16,826.0 19.3

Industries Qatar 135.30 0.2 16,757.7 (19.5)

QNB Group 182.50 0.3 13,771.1 (14.3)

Source: Bloomberg (* in QR)

Regional Indices Close 1D% WTD% MTD% YTD% Exch. Val. Traded ($

mn) Exchange Mkt. Cap.

($ mn) P/E** P/B**

Dividend Yield

Qatar* 11,785.22 (0.3) (1.3) (3.4) (4.1) 53.22 1,72,021.3 12.1 1.8 4.3

Dubai 4,143.21 0.3 (1.4) 1.4 9.8 94.88 1,05,668.2 12.3 1.4 6.3

Abu Dhabi 4,834.22 0.3 (1.3) 2.3 6.7 64.70 1,30,692.2 12.2 1.5 4.6

Saudi Arabia 9,098.27 (0.1) (2.9) 0.1 9.2 1,109.11 5,39,418.6 19.2 2.2 2.9

Kuwait 6,253.71 0.1 (0.5) 0.8 (4.3) 50.49 95,881.7 15.3 1.0 4.2

Oman 6,558.18 0.0 (0.5) 2.1 3.4 7.49 25,654.7 9.9 1.6 4.0

Bahrain 1,331.66 (0.1) (0.4) (2.6) (6.7) 0.74 20,827.6 8.5 0.9 5.3

Source: Bloomberg, Qatar Stock Exchange, Tadawul, Muscat Securities Exchange, Dubai Financial Market and Zawya (** TTM; * Value traded ($ mn) do not include special trades, if any)

11,700

11,750

11,800

11,850

11,900

9:30 10:00 10:30 11:00 11:30 12:00 12:30 13:00

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Qatar Market Commentary

The QSE Index fell 0.3% to close at 11,785.2. The Telecoms and Consumer Goods & Services indices led the losses. The index fell on the back of selling pressure from Qatari shareholders despite buying support from non-Qatari and GCC shareholders.

Gulf International Services and Islamic Holding Group were the top losers, falling 3.5% and 2.7%, respectively. Among the top gainers, Ahli Bank rose 4.3%, while Qatar Electricity & Water Co. was up 0.8%.

Volume of shares traded on Thursday fell by 14.8% to 4.4mn from 5.2mn on Wednesday. Further, as compared to the 30-day moving average of 4.8mn, volume for the day was 8.1% lower. Vodafone Qatar and Masraf Al Rayan were the most active stocks, contributing 17.7% and 10.3% to the total volume, respectively.

Source: Qatar Stock Exchange (* as a % of traded value)

Ratings, Earnings and Global Economic Data

Ratings Updates

Company Agency Market Type* Old Rating New Rating Rating Change Outlook Outlook Change

Doha Insurance Co. (DOHI)

S&P Qatar IFSR/CCR A/A A/A – Stable –

Mubadala Development Co.

S&P Abu

Dhabi LT ICR/ST ICR AA/A-1+ AA/A-1+ – Stable –

Source: News reports (* LT – Long Term, ST – Short Term, FSR- Financial Strength Rating, IFSR- Insurer Financial Strength Rating, CCR – Counterparty Credit Rating, FCR – Foreign Currency Rating, LCR – Local Currency

Rating, ICR – Issuer Credit Rating, IDR – Issuer Default Rating, SR – Support Rating, LC – Local Currency)

Earnings Releases

Company Market Currency Revenue (mn)

2Q2015

% Change

YoY

Operating Profit

(mn) 2Q2015

% Change

YoY

Net Profit (mn)

2Q2015

% Change

YoY

Red Sea Housing Services Co. (RSH)

Saudi Arabia SR – – 21.8 -47.6% 17.0 -58.3%

Tabuk Agricultural Development Co. (TADCO)

Saudi Arabia SR – – -2.2 NA 0.2 -64.8%

Qassim Agricultural Co. (QACO)

Saudi Arabia SR – – -0.1 NA 0.5 -78.2%

MetLife AIG ANB Cooperative Insurance Co.

Saudi Arabia SR 8.4 4,886.3% – – -7.9 NA

Astra Industrial Group Saudi Arabia SR – – 5.5 NA 20.1 553.8%

The Mediterranean and Gulf Insurance and Reinsurance Co.

Saudi Arabia SR 973.3 4.4% – – -134.9 NA

Dur Hospitality Co. Saudi Arabia SR – – 34.2 0.7% 34.2 -27.4%

National Medical Care Co. Saudi Arabia SR – – 38.8 23.2% 42.3 36.2%

Etihad Atheeb Telecommunication Co.

Saudi Arabia SR – – -72.1 NA -40.2 NA

Saudi Arabia Refineries Co. Saudi Arabia SR – – 17.3 17.6% 16.9 17.8%

Al Jouf Cement Co. (JCC) Saudi Arabia SR – – 30.3 55.8% 26.8 66.7%

Al Sorayai Trading and Industrial Group (ATIG)

Saudi Arabia SR – – 7.5 11.0% 3.9 -36.0%

Malath Cooperative Insurance and Reinsurance Co.

Saudi Arabia SR 257.2 62.4% – – 3.7 NA

Saudi Arabian Amiantit Co. (SAAC)

Saudi Arabia SR – – 46.1 -2.1% 26.0 5.8%

Al Hammadi Company for Development and Investment

Saudi Arabia SR – – 37.9 6.0% 36.9 3.6%

Saudi Fisheries Co. Saudi Arabia SR – – -8.0 NA -9.8 NA

Bishah Agricultural Development Co.

Saudi Arabia SR – – -0.3 NA -0.3 NA

Dubai Investments (DI) Dubai AED 616.9 -39.6% 0.0 NA 223.4 -58.7%

National General Insurance Co. (NGI)

Dubai AED 69.5 -18.4% 2.0 -62.5% 16.0 NA

Ras Al Khaimah Poultry & Feeding

Abu Dhabi AED 18.2 43.5% – – 7.5 -24.4%

Gulf Insurance Group (GIC) Kuwait KD 0.0 NA – – 3.7 24.1%

Oman Fiber Optic Co. (OFC)* Oman OMR 9.9 -18.4% – – 0.5 -86.6%

Oman National Investment Corporation Holding (ONIC)*

Oman OMR 8.8 12.3% – – 3.8 -4.3%

Bahrain Commercial Facilities Co. (BCFC)

Bahrain BHD 0.0 NA – – 4.4 4.8%

National Hotels Co. (NHC) Bahrain BHD 2.4 14.7% 1.2 16.8% 1.0 24.8%

Source: Company data, DFM, ADX, MSM (*1H2015 results)

Overall Activity Buy %* Sell %* Net (QR)

Qatari 57.22% 60.58% (65,23,893.39)

GCC 6.07% 5.40% 12,84,970.32

Non-Qatari 36.72% 34.01% 52,38,923.07

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Global Economic Data

Date Market Source Indicator Period Actual Consensus Previous

07/31 US BLS Employment Cost Index 2Q2015 0.20% 0.60% 0.70%

07/31 EU Eurostat Unemployment Rate June 11.10% 11.00% 0.60%

07/31 EU Eurostat CPI Estimate YoY July 0.20% 0.20% 7.90%

07/31 EU Eurostat CPI Core YoY July 1.00% 0.80% 0.80%

07/31 France INSEE PPI MoM June -0.20% – -0.50%

07/31 France INSEE PPI YoY June -1.90% – 1.1B

07/31 France INSEE Consumer Spending MoM June 0.40% 0.50% 64.8K

07/31 France INSEE Consumer Spending YoY June 1.40% 1.60% 1.90%

07/31 Germany Destatis Retail Sales MoM June -2.30% 0.30% 0.20%

07/31 Germany Destatis Retail Sales YoY June 5.10% 4.00% -1.00%

07/31 UK GfK NOP (UK) GfK Consumer Confidence July 4.0 5.0 98.7

07/31 Spain Bank of Spain Current Account Balance May 1.2B – -0.2B

07/31 Italy ISTAT PPI MoM June -0.30% – 0.30%

07/31 Italy ISTAT PPI YoY June -3.10% – -2.60%

08/01 China China Fed. of Logistics Manufacturing PMI July 50.0 50.1 50.2

08/01 China China Fed. of Logistics Non-manufacturing PMI July 53.9 – 53.8

Source: Bloomberg (s.a. = seasonally adjusted; n.s.a. = non-seasonally adjusted; w.d.a. = working day adjusted)

News Qatar

QCB to issue T-bills worth QR4bn on August 4 – The Qatar Central Bank (QCB) will issue new three month treasury bills worth QR2bn, along with six and nine month T-bills worth QR1bn each on August 4, 2015. (QCB)

MERS units completes sale of 49% stake in Al Oumara Bakeries – Al Meera Consumer Goods Company (MERS) announced that its subsidiaries, both Al Meera Holding Company and Al Meera Development Company, have completed the sale of shares representing 49% of the capital of Al Oumara Bakeries Company to Qatar Quality Food for a consideration of QR3mn. (QSE)

QGMD to disclose financial statements on August 13 – Qatari German for Medical Devices Company (QGMD) will disclose its financial reports for the period ending June 30, 2015 on August 13, 2015. (QSE)

ZHCD to disclose financial statements on August 13 – Zad Holding Company (ZHCD) will announce its financial statements for the period ending June 30, 2015 on August 13, 2015. (QSE)

S&P affirms DOHI ratings at ‘A’ – Standard & Poor’s (S&P) Ratings Services affirmed its ‘A’ insurer financial strength and counterparty credit ratings on Qatar-based Doha Insurance Co. (DOHI). The outlook remains stable. S&P said although the company’s operating performance had deteriorated in 2014 as a result of higher expenses, mainly in relation to set-up costs of its Dubai entity, the company continued to outperform its peers with a combined (loss and expense) ratio of 79.9% (versus 75.3% in 2013). S&P also views favorably DOHI’s diversification plans and the relatively high level of controlled distribution. The rating agency has therefore changed its assessment of the insurer’s competitive position to strong from adequate. (Peninsula Qatar)

Barwa Bank reports QR412mn net profit in 1H2015 – Barwa Bank reported a net profit of QR412mn in 1H2015. The bank’s total assets soared by 16% to QR41.3bn in 1H2015, underlined by sizeable growth across its financing assets and investment securities, whereas financing assets alone registered a 10% increase to exceed QR24.4bn. Customer deposits increased by 4% to QR23.2bn in 1H2015, owing to the bank’s strong focus on product & service development and integration across business segments, as well as a heavy push to tech-driven innovation. Earnings per share rose to QR1.39 in 1H2015 versus QR1.38 in 1H2014. (Gulf-Times.com)

6Wresearch: Air-conditioning market in Qatar to witness high growth – The global market research and consulting firm, 6Wresearch in its report ‘Qatar Air Conditioner (2015-2021)’ said that the country’s air-conditioning market is projected to witness a compound annual growth rate of 13.42% during 2015-21. Qatar is renovating and building stadiums and will install powerful cooling systems there to provide ambient temperature during the international sporting event. The upgrade of existing stadiums and construction of new ones will create a fresh demand for ACs in Qatar. Besides, mega construction activities in the areas of hospitality, retail, healthcare, transportation and leisure & entertainment will create huge opportunities for air-conditioner players in the country. (Gulf-Times.com)

QCB Chief: QSE upgrade top achievement of QFMA in 2014 – Qatar Central Bank (QCB) Governor Sheikh Abdullah bin Saud al Thani said the upgrade of the Qatar Stock Exchange (QSE) to the status of emerging market by international institutions like MSCI and Standard & Poor's was the top achievement of the Qatar Financial Markets Authority (QFMA) in 2014. The QCB governor noted that the upgrade is vital for increasing flows of foreign investments to QSE, boost trading and enhance its international status. He said this important achievement came after the amendments and additions to the applicable legislations were made by the QFMA in cooperation with QCB and Qatar Financial Center (QFC) to develop the Qatari capital market. Qatar's economy assumed advanced ranks on the scale of the international and Arab classifications in 2014. He further added that Qatar's capital market needs to achieve further progress and prosperity by exerting more efforts. (Qatar Tribune)

International

US GDP accelerates, wage growth slows in 2Q2015 – The US economic growth accelerated in 2Q2015 as solid consumer spending offset the drag from weak business spending on equipment. The Commerce Department said the GDP expanded at a 2.3% annual rate in 2Q2015. GDP in 1Q2015, previously reported to have shrunk at a 0.2% pace, was revised up to show it rising at a 0.6% rate. The economy grew 1.5% in 1H2015 as compared to 1.9% during 1H2014. The growth in 2Q2015 was boosted by consumer spending, which grew at a 2.9% rate from a 1.8% pace in 1Q2015. On the other hand, US labor costs in 2Q2015 recorded their smallest increase in 33 years as workers earned less in commissions and bonuses. The Labor Department said the

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Employment Cost Index, the broadest measure of labor costs, edged up 0.2% followed a 0.7% rise in 1Q2015. However, the surprisingly smaller rise reported by the Labor Department did little to temper expectations that the Federal Reserve is set to raise interest rates later in 2015. (Reuters)

Eurozone inflation stable, economic confidence strengthens in July – Eurozone inflation remained unchanged in July as a further decline of energy prices negated the impact of more expensive industrial goods and services, leaving the European Central Bank (ECB) with more work to do to push up prices. The European Union’s statistics office, Eurostat said that consumer prices in the 19 countries sharing the euro rose by 0.2% YoY in July, same as in June. Energy prices were 5.6% lower YoY, a steeper decline than in June. Unprocessed food increased by 1.3% in July, down from 1.9% in June. The eurozone ended four months of deflation in April, but inflation is still far below the ECB’s target of just under 2%. Meanwhile, the European Commission’s monthly economic sentiment indicator for eurozone edged up to 104.0 in July from 103.5 in June. Business morale increased to 0.39 points, its highest level since May 2014. The commission said that improved sentiment resulted from higher confidence in industry, services and retail trade, which was only partially outweighed by lower consumer confidence. (Reuters)

Japan factory output subdued, spending slumps in June – Japan’s factory output rose modestly in June after a big drop in May, highlighting worries of an economic slump in 2Q2015 as exports weaken and manufacturers are saddled with large inventories. Data from the trade ministry showed industrial production rose 0.8% MoM in June after dropping 2.1% in May. Meanwhile, Japanese household spending fell 2.0% in the year to June after rising 4.8% in May, confounding market expectations for a 1.7% increase. While the government blamed the rainy weather for deterring shoppers, weak demand for cars and housing suggest the rising cost of living is denting appetite for big-ticket items. Moreover, annual core consumer inflation, which includes oil products but excludes volatile fresh food prices, rose 0.1% in June, slightly exceeding market expectations of no change. The unexpected fall in household spending and stalling inflation is heightening the chance the economy may have contracted in April-June and casting doubts on the central bank’s view that growth will rebound solidly in 3Q2015. (Reuters)

China official PMI slips as growth slowdown bites – The China’s official manufacturing Purchasing Managers’ Index (PMI) slipped to a five-month low. The PMI stood at 50 in July, down from 50.2 in June. The non-manufacturing PMI, a measure of services and construction, was at 53.9 versus 53.8 in June. Numbers above 50 indicate expansion. Zhao Qinghe, Senior Statistician at the National Bureau of Statistics said the internal and external demand for the manufacturing sector is still on the weak side. Zhao cited the impact from hot weather, storms and commodity prices as major reasons for the drop. The data echoes a private PMI that weakened in July, an indication interest-rate cuts and efforts to shore up local government finances have yet to spark a recovery despite recent signs of stabilization. (Bloomberg)

Brazil boosts key rate for sixth straight meeting – Brazil’s central bank raised its key rate by 50 basis points (bps) for a sixth straight meeting and signaled that borrowing costs are high enough to slow inflation toward its target. The bank’s board boosted the Selic rate to 14.25%. The central bank changed language in the communiqué for the first time in 2015, adding that “holding that interest rate level for a sufficiently prolonged period is necessary for the convergence of inflation toward the target at the end of 2016.” With inflation running at more than double the official target, policy makers chose to maintain the pace of rate increases

in the face of a looming recession in Latin America’s largest economy. (Bloomberg)

Russia central bank cuts key rate on cooling economy – Russia’s central bank cut its key interest rate by 50 basis points (bps) to 11% on July 31, as expected, citing a cooling economy that it said outweighed inflation risks. In its accompanying statement, the bank played down a recent pick up in inflation, focusing instead on the economic downturn, which the bank said may lead it to revise down its output forecasts. The bank also removed a phrase saying that it was ready to lower rates in line with falling inflation in future. Meanwhile, inflation accelerated to 15.8% as of July 27, up from 15.3% in June. The bank said that was temporary result of utility tariff increases and inflation would fall to 7% in July 2016 and to 4% in 2017, meeting the bank’s target. The bank appeared much more worried about economic growth, saying an unexpectedly severe contraction in domestic demand in 1H2015 meant that it may lower its output forecast for a 3.2% GDP contraction in 2015. (Reuters)

Regional

JLL: 453 new Mideast hotel projects in pipeline – According to a report released by Jones Lang LaSalle (JLL) for The Hotel Show Dubai, to be held in September, the Middle East (Mideast) is witnessing a massive development in the hospitality sector with a total of 453 hotel projects planned over the next five years. The new hotels will add 134,217 rooms to the hospitality offering in the region. As per the report, about 5,300 rooms are likely to be added to Abu Dhabi's luxury hospitality offering by 2017, pushing the Emirate’s total room tally to 26,000 from 20,700. Around 2,300 rooms will enter the market by the end of 2015 alone, mainly in response to the boom in hotel guests during 1Q2015, up 20% as compared to 1Q2014. Abu Dhabi has been witnessing positive growth due to a large number of government initiatives to grow the Emirate as a high quality tourist destination. (GulfBase.com)

OPEC oil production falls as Iraqi output slips from record – OPEC crude output declined in July 2015 as Iraqi production slipped from a record in June 2015. According to a Bloomberg survey of oil companies, producers and analysts, output by the OPEC decreased 362,000 barrels to 32.107mn barrels a day in July 2015. June’s total was revised 335,000 barrels higher, to 32.469mn barrels a day, because of changes to the Saudi, Kuwaiti, Angolan and Nigerian estimates. As per Bloomberg data, OPEC agreed on June 5 to retain its collective output target of 30mn barrels a day, a level that it exceeded for 14 months. As per the survey, Iraqi production dropped 194,000 barrels a day to 4.194mn barrels in July 2015. (Bloomberg)

Saudi Aramco testing C02 to get more oil from Ghawar field – Saudi Arabian Oil Company (Saudi Aramco) started injecting carbon dioxide to try and boost extraction rates from the world’s biggest oil field as the company steps up plans to recover more crude from its deposits. Saudi Aramco already started injection and will put 40mn standard cubic feet per day of CO2 into the Uthmaniyah area south of the Ghawar field. Saudi Aramco’s Chief Technology Officer, Ahmad al-Khowaiter said in March that injecting CO2 into Uthmaniyah will boost oil-recovery rates by 10 to 15 percentage points. (Bloomberg)

Saudi Arabia to double solar capacity with 50 MW project – Saudi Arabia’s King Abdulaziz City for Science & Technology is planning a 50 megawatt (MW) solar farm that would more than double the amount of energy generated from sunlight in the world’s largest oil exporter. According to Saudi Press Agency (SPA), King Abdulaziz City signed agreements with Saudi Electricity Company and Saudi Technology Development & Investment Company for the project in the city of Saudi Aflaj. Saudi Arabia has embarked on a solar

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development program as countries in the region seek to reduce the amount of oil they burn for electricity. (Bloomberg)

RSHS updates on construction of factory & housing camp in KAEC – Red Sea Housing Services Company (RSHS) announced that it was unable to complete the construction of a factory in King Abdullah Economic City (KAEC) in Rabigh. The delay is mainly attributed to numerous changes in the design and specifications of the factory to comply with the requirements of the Economic Cities Authority and Emaar Economic City, as well as changes in certain economic conditions. The company has started the infrastructure activities on site and construction of the boundary walls. It is estimated that 25% of the project has been accomplished. The total amount invested on the execution of works to date has amounted to SR6.51mn. Meanwhile, RSHS has announced the delay in the construction of a housing camp within KAEC in Rabigh to accommodate employees of companies that exist within KAEC; it advises that the study period which was anticipated to be completed before the 2Q2015 financial results are released, has been extended to 1Q2016. The company is expensing lease rent during the study period. The company has started infrastructure activities on site and construction of the boundary walls. It is estimated that 25% of the project has been accomplished. The total amount invested on the execution of works has amounted to SR11.93mn. (Tadawul)

Al-Khodari updates on rights issue – Abdullah A. M. Al-Khodari Sons Company has informed its shareholders that it is, in coordination with its financial advisor, in the process of preparing the application for capital increase for submission to the Capital Market Authority (CMA). The application is expected to be submitted to the CMA before August 31, 2015 after incorporating the 1H2015 financial results for the period ending June 30, 2015 which were announced on July 26, 2015. The company will announce the submission of the file to the CMA in due course. (Tadawul)

Bahri completes sale of SR3.9bn Sukuk – The National Shipping Company of Saudi Arabia (Bahri) has successfully completed the issuance of Sukuk at a total nominal value of SR3.9bn. The Sukuk has an expected return at 80 bps above the SIBOR rate, and will mature in July 2022. The company will use the proceeds for repaying a Murabaha bridge financing facility, which was signed on June 22, 2014, while the remaining proceeds will be used for general corporate purposes. (Tadawul)

Foreign firms bid for $5bn KSA gas project – According to sources, foreign engineering firms have submitted bids to build a gas plant in eastern Saudi Arabia for Saudi Arabian Oil Company (Saudi Aramco) at an estimated cost of $5 to $6bn. The new plant will have a processing capacity of 2.5bn standard cubic feet per day (scfd) of sour gas from the onshore Khursaniyah and offshore Hasbah fields. South Korea’s Daelim Industrial, Hyundai Engineering and Construction and UK’s Petrofac have bid for the project individually. Additionally, three consortiums have been formed to bid: South Korea’s GS Engineering and Construction with Spainís Tecnicas Reunidas, Italy’s Saipem with Japan’s JGC, and South Korea’s Samsung Engineering together with Daewoo E&C. The project is split into three construction packages for the gas processing unit, utilities and offsite facilities such as nitrogen, steam, power & water systems, and sulphur recovery. (GulfBase.com)

UAE signs MoU with Portugal to boost tourism – The UAE has signed a MoU with Republic of Portugal to promote and encourage cooperation in the field of tourism. The MoU aims to strengthen friendly relations between the two countries by increasing bilateral cooperation in the field of tourism, in recognition of the importance of tourism in promoting economic development,

mutual understanding and goodwill, as well as reinforcing ties between people. (GulfBase.com)

Mashreq CEO: UAE credit growth expected to be around 2% in 2015 – Mashreq Bank CEO and Chairman of the UAE Banks Federation, Abdul Aziz al-Ghurair said that credit growth in the UAE is expected to be around 2% in 2015. His forecast was lower than the expectations of many bankers just a few months ago and is a fresh sign the UAE credit cycle may have peaked because of low oil prices and cooling property markets. Ghurair also predicted that banking sector profits would rise about 10% in 2015 – but said some of that growth would come from lower impairment charges for bad loans, rather than expansion of lending. According to revised central bank data, gross bank lending in the UAE grew 8.0% in 2014. A recently published quarterly central bank survey showed growth in demand for business credit and personal loans continued to slow in 2Q2015, while lenders' expectations for the quarter ahead softened. The central bank attributed the slowdown to a natural adjustment from unusually fast growth in the middle of 2014. (GulfBase.com)

ADX, DME bourses explore possibility of stock futures – Dubai Mercantile Exchange (DME) Managing Director Owain Johnson said that the Abu Dhabi Securities Exchange (ADX) is considering introducing with the DME, futures and options contracts for specific Abu Dhabi stocks as well as market index futures. The exchanges have established a joint committee which will examine the issue over the next few months. (GulfTimes.com)

Emirates adds fourth daily A380 service to Bangkok – Emirates has launched its fourth daily A380 service between Dubai and Bangkok with an upgradation of its current services from December 1, 2015. The move is expected to benefit travellers from the region, including Qatar, and beyond. The new two-class A380 service will operate daily as flight EK376 from Dubai to Bangkok and EK377 from Bangkok to Dubai. (Gulftimes)

Oman: Ahli Bank reports 10% YoY rise in 1H2015 net profit – Ahli bank reported a net profit of OMR14.6mn in 1H2015, indicating an increase of 10% on a YoY basis. The bank’s operating income has increased by 14.3% YoY to OMR28.9mn in 1H2015, while customer deposits rose by 22.9% YoY in 1H2015. Ahli bank’s operating income has increased by 14.3% YoY to OMR28.9mn in 1H2015, and operating expenses, excluding loan and financing impairment net of recoveries, were controlled at OMR9.8mn, resulting in a cost-to-income ratio of 34%. The bank’s total assets stood at OMR1.85bn as of June 30, 2015, reflecting an increase of 21.8% YoY. (GulfBase.com)

Omani delegation to visit Iran to finalize $60bn gas deal – National Iranian Gas Export Company (NIGEC) Director General, Alireza Kameli said that an Omani delegation is scheduled to travel to Iran to finalize a gas deal. It will come almost two years after the visit of His Majesty Sultan Qaboos to Tehran, during which a MoU was signed for the export of Iran's gas to Oman. A few months later, the MoU was upgraded to a contract, which is expected to be finalized in the upcoming visit of the Omani delegation. According to the contract, Iran will export 28mn cubic meters of gas to Oman for 15 years. Based on the current gas price, the deal is worth $60bn. (GulfBase.com)

Oman officially begins cooperating with GCC electricity grid – Abdul Wahab Al Hinai, Director of Licences & Legal Affairs at Oman's Authority for Electricity Regulation said that Oman has started officially cooperating with the GCC Interconnection Authority since 2015, as the Sultanate receives and transfers electricity for emergency or commercial purposes. (Zawya)

BisB net profit surges 105% YoY in 1H2015 – Bahrain Islamic Bank (BisB) reported a net profit of BHD8.2mn in 1H2015 as compared BHD4.1mn in 1H2014, reflecting an increase of 105% on a YoY

Page 6 of 7

basis. The bank’s total income reached BHD20.98mn in 1H2015 as compared to BHD18.46mn in 1H2014. BisB’s total assets stood at BHD900.33mn at the end of June 30, 2015 as compared to BHD875.21mn at the end of December 31, 2014. Customers’ current account stood at BHD144.45mn. EPS amounted to BHD8.75 in 1H2015 versus BHD4.32 in 1H2014. (Bahrain Bourse)

KHCB net profit surges 177% in 1H2015 – Khaleeji Commercial Bank (KHCB) reported a net profit of BHD4.4mn in 1H2015, reflecting an increase of 177% as compared to BHD1.6mn for 1H2014, and 164% higher than 1Q2015 by BHD2.7mn (i.e from BHD1.7mn to BHD4.4mn). Total assets reached BHD646.2mn, an increase of 8.3% as compared to December 2014 and 3.1% over 1Q2015. The profitability ratios have improved with the annualized return on average assets of 1.4% and annualized return on average equity of 8.3%. Customers’ current accounts stood at BHD56.15mn. The bank’s financial position remains strong with a liquid asset ratio of 26.4% and a capital adequacy ratio of 18.3%, which is well above the regulatory minimum of 12.5%. The basic EPS amounted to BHD4.265 in 1H2015 versus BHD1.091 in 1H2014. (Bahrain Bourse)

Batelco partners with VKL Holding Group – Bahrain Telecommunication Company (Batelco) has announced a partnership with VKL Holding Group to provide end-to-end fiber infrastructure for Juffair Mall and Juffair Hotel, due to open in September 2015. (GulfBase.com)

Contacts

Saugata Sarkar Sahbi Kasraoui QNB Financial Services SPC

Head of Research Head of HNI Contact Center: (+974) 4476 6666

Tel: (+974) 4476 6534 Tel: (+974) 4476 6544 PO Box 24025

saugata.sarkar@qnbfs.com.qa sahbi.alkasraoui@qnbfs.com.qa 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 7 of 7

Rebased Performance Daily Index Performance

Source: Bloomberg Source: Bloomberg

Source: Bloomberg Source: Bloomberg (*$ adjusted returns)

80.0

100.0

120.0

140.0

160.0

180.0

Jul-11 Jul-12 Jul-13 Jul-14 Jul-15

QSE In dex S&P Pan Arab S&P GCC

(0.1%)

(0.3%)

0.1%

(0.1%)

0.0%

0.3% 0.3%

(0.5%)

(0.3%)

(0.1%)

0.1%

0.3%

0.5%

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Asset/Currency Performance Close ($) 1D% WTD% YTD%

Global Indices Performance Close 1D%* WTD%* YTD%*

Gold/Ounce 1,095.82 0.7 (0.3) (7.5) MSCI World Index 1,765.60 0.3 1.2 3.3

Silver/Ounce 14.78 0.2 0.6 (5.9) DJ Industrial 17,689.86 (0.3) 0.7 (0.7)

Crude Oil (Brent)/Barrel (FM Future)

52.21 (2.1) (4.4) (8.9) S&P 500 2,103.84 (0.2) 1.2 2.2

Crude Oil (WTI)/Barrel (FM Future)

47.12 (2.9) (2.1) (11.5) NASDAQ 100 5,128.28 (0.0) 0.8 8.3

Natural Gas (Henry Hub)/MMBtu

2.77 (2.8) (1.7) (7.6) STOXX 600 396.37 0.9 0.7 5.2

LPG Propane (Arab Gulf)/Ton 37.75 (2.6) (9.3) (23.0) DAX 11,308.99 1.3 (0.1) 4.4

LPG Butane (Arab Gulf)/Ton 50.38 (1.9) (5.4) (23.1) FTSE 100 6,696.28 0.7 2.5 2.3

Euro 1.10 0.5 0.0 (9.2) CAC 40 5,082.61 1.5 0.7 8.2

Yen 123.89 (0.2) 0.1 3.4 Nikkei 20,585.24 0.6 0.0 13.7

GBP 1.56 0.1 0.7 0.3 MSCI EM 901.68 0.9 (1.0) (5.7)

CHF 1.03 0.3 (0.3) 2.9 SHANGHAI SE Composite 3,663.73 (1.1) (10.0) 13.2

AUD 0.73 0.2 0.4 (10.6) HANG SENG 24,636.28 0.6 (2.0) 4.4

USD Index 97.34 (0.2) 0.1 7.8 BSE SENSEX 28,114.56 1.7 0.2 1.0

RUB 61.71 3.3 5.3 1.6 Bovespa 50,864.77 0.4 0.9 (21.3)

BRL 0.29 (1.4) (2.0) (22.5) RTS 858.82 (1.0) (0.0) 8.6

141.5 121.3 116.0