Saudi banks fall on zakat payments

Sentiment across Arabian Gulf markets was hurt by the plunge in Wall Street stocks last Friday as the US government shutdown weighed on global markets.

Saudi shares recovered some ground yesterday, however, after a sell-off in the banking sector when lenders said they had reached a deal with Islamic tax authorities to resolve a dispute over increased liabilities that would still result in big one-off payments. The Saudi index opened more than 2 per cent lower. By the close, the benchmark ended down by 0.3 per cent to 7,731 points.

Al Rajhi Bank, which declined as much as 5.7 per cent in early trading, recovered, rising as much as 1.2 per cent.

Saudi Basic Industries, which is the largest company on the Saudi equities market, rose 0.2 per cent, providing support to the market. Other stocks also rose, including telecom operator Zain Saudi Arabia, which rose 2.3 per cent.

The Dubai Financial Market General Index was down 1.2 per cent to 2,479 points, dented by property stocks. Dubai’s Damac Properties was down 4.5 per cent.

Dubai’s biggest developer Emaar Properties was down 3.8 per cent, while Union Properties was down 5 per cent.

World stock markets fell on Friday as further hikes in US borrowing costs impacted investor sentiment.

Sources on Saturday said that US President Donald Trump had privately discussed the possibility of firing Federal Reserve Chairman Jerome Powell. Treasury Secretary Steven Mnuchin, however, tweeted late on Saturday that Mr Trump had told him that he had “never suggested” dismissing Mr Powell.

Abu Dhabi shares declined 0.8 per cent yesterday to 4,817 points, weighed by energy stocks, after Brent crude fell 2.3 per cent to $53.10 on Thursday.

Abu Dhabi National Energy Company, also known as Taqa, was down 9.5 per cent.

Qatar’s index was down 1.2 per cent with blue-chip stocks such as Industries Qatar down over 2 per cent. Oman’s benchmark was largely unchanged at 4,336 points. National Bank of Oman yesterday said it will consider the interests of all shareholders in assessing the merits of a merger with Bank Dhofar.

Bahrain’s index largely unchanged at 1,314 points.