Qatar shares seen as 'overbought'

STOCKS 'OVERBOUGHT': Qatar stock market seen heading south by EFG-Hermes. (Getty Images)

New research from Egypt’s EFG-Hermes says the Qatari stock market is now 'overbought' and is poised to decline after a two-month rally that has seen it outperform its peers in the Gulf region.

In a report carried by Bloomberg, the investment bank says the market’s relative strength index - a technical gauge derived by averaging daily gains and losses over a fixed period, rose to its highest level in 18 months last week, signaling that a drop in prices may be overdue.

''We’re going to see a decent correction in the Qatari market,'' said Cairo-based senior technical analyst Mohammed El-Aasar.

''In the next several days, we may see a 10 percent to 15 percent decline in a gradual way,'' he added. 

The DSM 20 has surged more than 50 percent from its low in early March as Qatar has remained largely out of the economic firing line.

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