Abu Dhabi stocks drop most in month

Abu Dhabi stocks retreated the most in a month after three banks said they were unaware of plans for possible mergers, dashing investor optimism that competition in the emirate’s financial sector will ease. Abu Dhabi’s ADX General Index fell 1.7 per cent after Abu Dhabi Commercial Bank PJSC, Union National Bank PJSC and Abu Dhabi Islamic Bank PJSC made statements about reports of potential combinations. The lenders were suspended briefly before sinking at least 0.8 per cent. Saudi Arabia’s Tadawul All Share Index reversed gains of as much as 0.5 per cent. The shares of all three banks rallied last week on reports the government was considering more financial-institution mergers after combining National Bank of Abu Dhabi PJSC and First Gulf Bank PJSC. The emirate is consolidating companies after the price of oil, one of its main sources of revenue, declined more than 40 per cent in the past two years. Abu Dhabi sits on about 6 percent of the world’s proven crude reserves. ADCB declined 2.7 per cent, ADIB retreated 0.8 per cent and UNB fell 5.2 per cent. (Filipe Pacheco and Sharon Wrobel/Bloomberg)