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Tue 21 Dec 2010 10:50 AM

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Qatar index gains most in a week on oil, World Cup optimism

UPDATE 4: Industries Qatar climbs the most in more than two weeks as crude prices rallied for a third day

Qatar index gains most in a week on oil, World Cup optimism
STOCK WATCH: Markets in the UAE were muted in early trade (Getty Images)

Qatar’s benchmark stock index rose the most in a week as a jump in oil prices boosted Industries Qatar and on speculation winning the bid to host the 2022 World Cup will generate earnings.

Industries Qatar, the second-biggest petrochemicals maker in the Middle East, climbed the most in more than two weeks as crude prices rallied for a third day.

Al Khaliji, a Doha-based bank, had its biggest gain since December 9 after merger talks with International Bank of Qatar advanced.

The QE Index added 0.4 percent to 8,664.15 at the 12:30 p.m. close in Doha, bringing its 2010 rally to 25 percent.

Industries Qatar, which accounts for 12 percent of the QE’s weighting, rose 1.7 percent, the most since December 5, to QR135.6. Oil increased to a two-week high of $89.66 a barrel in New York on speculation that economic growth in the US will accelerate next year.

Barwa Real Estate Co, Qatar’s biggest publicly traded property developer by assets, climbed 0.5 percent to QR37.5. United Development Co, a Qatari company that invests in real-estate and energy, added 0.7 percent to 28.2 riyals

“They still have a long way of development ahead of them” before the World Cup “and this will boost the market,” said Mohamed Khaled Hafez, relationship manager at Prime Emirates in Abu Dhabi. “There is room for more gains,”

The $81bn Qatari economy will expand 16 percent this year, the world’s fastest-growing, from 8.6 percent in 2009, the International Monetary Fund said in its World Economic Outlook report in October. Moody’s Investors Service estimates Qatar will spend about $57bn over the next decade for infrastructure developments related to the World Cup.                       

The QE Index of stocks has gained 5.9 percent since December 2 when Qatar was awarded the right to host the World Cup.

Khaliji surged as much as 5 percent before closing 1.9 percent higher at QR16.4. The lender said talks to merge with the International Bank of Qatar are in the “final stages”.

Dubai’s main measure of stocks lost 0.4 percent. Abu Dhabi’s gauge decreased 0.7 percent.

Saudi Arabia’s Tadawul All Share Index advanced 0.2 percent.  Oman’s benchmark advanced 0.4 percent, while Bahrain’s measure retreated 0.2 percent. The Kuwait SE Price Index gained 0.3 percent.

The Bloomberg GCC 200 Index of companies in the region increase 0.1 percent at 2:47 p.m. in Dubai.

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