Lebanon’s benchmark stock index dropped the most since July as Hezbollah said their ministers plan to resign after a Saudi-Syrian drive to resolve controversy over a United Nations investigation into the murder of the country’s former prime minister failed.
The BLOM Stock Index tumbled 3.2 percent, the most since July 21, to 1,488.65 at the 12:30 p.m. close in Beirut. The measure has lost 5.3 percent in the past 12 months. Solidere SAL, the largest publicly traded company in Lebanon, plunged the most since 2008.
“The pullout from Hezbollah raises the chance that their threats for civil unrest may materialize,” Haissam Arabi, chief executive officer of Gulfmena Alternative Investments in Dubai, said in a telephone interview today. “Last time we had civil unrest, it paralyzed the country economically.”
A UN tribunal investigating the 2005 killing of Rafiq Hariri, the incumbent prime minister’s father, may indict members of the Iran- and Syria-backed Hezbollah, raising the specter of violence in the country that came out of 15 years of civil war in 1990. U.S.-backed Prime Minister Saad Hariri will work to help find solutions that guarantee national unity, he said in a statement yesterday.
Solidere’s A shares slumped 8.2 percent, the most since October 2008, to $18.73 and the construction company’s B shares lost 6.7 percent to $18.72. Banque Audi SAL-Audi Saradar Group, the largest lender in Lebanon by assets, fell 1.4 percent to $8.8.