GFH jump is highlight of quiet day on DFM

A leap by shares in GFH Financial enlivened an otherwise dull Dubai stock market yesterday, while bank stocks dragged on Saudi Arabia’s index for a second straight day because of concern about their Islamic tax liabilities.

The Dubai index was flat at 3,307 points but GFH climbed 6.6 per cent and accounted for over a third of market volume after saying Jassim Alseddiqi, chief executive of Abu Dhabi Financial Group, had been elected chairman of its board.

The company did not explain the development but it could point to closer cooperation between GFH and ADFG, which owns nearly half of Shuaa Capital, whose shares gained 1.8 per cent.

GFH and Shuaa held merger discussions last year but the talks were called off in June.

Mr Alseddiqi told Al Arabiya television yesterday that after last year’s talks failed between GFH and Shuaa to produce a result, “Currently we at GFH are looking at other acquisitions.”

Saudi Arabia’s index fell 0.3 per cent to 7,472 points as nine of 12 bank stocks fell, with Al Rajhi – which foreign funds have been pouring into in recent weeks in anticipation of Saudi Arabia joining emerging market indexes – pulling back 1.3 per cent.

Reuters reported on Thursday about rising Islamic tax liabilities at Saudi banks. In recent weeks, several banks have disclosed the government is seeking additional zakat payments from them going back as far as 2002. Analysts expect more banks to disclose zakat demands in coming weeks.

Qatar’s index fell 1 per cent with Qatar National Cement plunging 7.5 per cent and Qatar Insurance losing 6.2 per cent as both went ex-dividend.

In addition Qatar National Bank, the largest lender, slid 3.1 per cent. The stock closed below its 100-day average, which had been acting as support, for the first time since mid-December - a negative technical signal.

In Egypt, the index edged down 0.1 per cent to 15,454 points but Palm Hills Development gained 3.2 per cent after reporting that fourth-quarter consolidated net profit after tax and minority interests jumped 44 per cent to 338.6 million Egyptian pounds. It said it was targeting net profit of over 800m pounds this year.

Bahrain’s iIndex gained 0.7 per cent to 1,371 points.