Qatar sale hits Barclays shares

Barclays share price

Barclays closed down almost 5% after Qatar's sovereign wealth fund sold shares in the bank worth £1.3bn.

The Middle East investors bought into Barclays last year, when it decided to raise capital privately rather than take money from the UK government.

The deal makes Qatar Holding the second major Gulf investor to cash in its share of Barclays this year.

In 2008, Barclays raised £7bn from Middle East investors to boost its finances.

In June, Abu Dhabi firm International Petroleum Investment Company, which had also participated in last year's fund raising, sold more than a billion Barclays shares.

Reports suggest that it will now turn its attention to Sainsbury's, which saw its shares close up 5.4% on the news.

The supermarket, the UK's third largest grocer, declined to comment on speculation that the Qatar Investment Authority was planning to increase its current 26% stake, with a view to making another bid.