Qatar's stimulus package for the private sector, especially the QR10bn support to the listed entities, has considerably enhanced investors' confidence in Doha’s capital market, as reflected in "significant" increase in average daily trade value on the Qatar Stock Exchange (QSE).

"The move, it seems, has encouraged investors and given them confidence, as reflected in the average daily trading values, which have increased significantly during the months of April and May compared to the same period of last year," QSE chief executive officer Rashid bin Ali al-Mansoori told Gulf Times in an interview.

In March, the Supreme Committee for Crisis Management (to combat Covid-19), presided over by His Highness the Amir Sheikh Tamim bin Hamad al-Thani, had extended a whopping QR75bn stimulus package to the private sector. Additionally, QR10bn would be injected to boost the country’s capital market.

Taking positive cues from the QR10bn fund support, sentiments by and large improved as the bourse's capitalisation at present stands at QR500bn.

The QR10bn allocated by the government was principally designed to provide price support for the listed securities on the market. It helps by ensuring that there is sufficient liquidity in the market to satisfy investors looking to sell their holdings, al-Mansoori said.

"The funds are not channelled to the listed companies themselves. Direct support can be channelled to companies by the government if required but this would not involve the QSE," he said.

"We are supportive of our listed companies, which are private sector entities, and as an exchange, we are doing our best to help them by ensuring that our market continues to operate and does so with integrity," he said.

Asserting that the QSE is committed to ensuring liquidity, al-Mansoori said the exchange provides the means for the companies to secure equity finance, either through initial public offerings, or through rights issue.

At present, there are 47 listed companies, comprising 13 under the banks and financial services sector, 10 each under consumer goods and industrials, five under insurance, four under real estate, three under transport and two under telecom sector.

A KPMG Qatar report recently said the business sentiment has been less adverse in the local companies, as reflected in the (performance of) the QSE vis-a-vis other markets.

The listed constituents cumulatively reported net profit of QR8.39bn in the first three months of this year, which according to al-Mansoori, “indicates the strength of our listed companies in the face of exceptional circumstances.”

Asked what kind of support could the listed firms expect from the bourse especially in the backdrop of Covid-19, he said the QSE is a strong advocate of effective and supportive regulations and legislation that control how the market operates and how participants behave, but also protects the rights of investors.

"We do make representations to the regulatory powers and the legislature on a regular basis to recommend adjustments to existing frameworks, when we believe that these changes would benefit the capital markets and its stakeholders," he said.

In a recent move, the QSE, after getting approval from the regulator, said market making would be allowed on the constituents of the Qatar Index, the constituents of the QE Al Rayan Islamic Index, the stocks whose quarterly turnover rate is equal to or more than 10% (in each quarter) and also that the quarterly frequencies in their trading exceed 80% of all trading days in each quarter, and units of the exchange traded funds.