Shares in Qatar National Bank made their largest one-day drop in 12 months on Monday as investors reacted to flat profit growth in the fourth quarter and no share option in its dividend, while other regional markets closed mixed.
The heavyweight lender's results met estimates. QNB set a 60 percent cash dividend equivalent to 6 riyals per share but retail investors, hoping for bonus shares, were not impressed.
"We saw some profit-taking after its very strong (stock) performance because the numbers were in line to a slight miss of estimates," said Anastasios Dalgiannakis, institutional trading manager at Mubasher. "The dividend payout doesn't mean the market will bypass the operational performance."
QNB fell 2.6 percent to 134.4 riyals, its largest one-day loss since January 2012. The stock rallied from 131 riyals and peaked at Sunday's intraday high of 141.70 riyals per share.
Disappointed retail investors were expecting a share dividend of around 10 to 15 percent.
"The base of growth for QNB will be moderate but I see the results as good - there isn't much pressure on margins as its capital adequacy ratio, at 21 percent, is comfortable," said Reda Gomaa, portfolio manager at Mashreq. "I think it's a good time to buy given their acquisition plan on NSGB."
Societe Generale agreed late last year to sell its majority stake in Egypt's National Societe Generale Bank to QNB for $2bn, as part of the French bank's bid to meet new capital requirements.
Other large-caps also declined. Industries Qatar slipped 0.6 percent. The energy firm hit a 54-month high last week as strong earnings growth supported buying.
Doha's market, which closed 0.5 percent down, had seen a surge of inflows from foreign investors this year, but buying has now steadied. Funds are shifting out of IQ to other regional stocks like petrochemical heavyweight Saudi Basic Industries Corp (SABIC), Dalgiannakis added.
Saudi Arabia's bourse ended lower for a second session since Thursday's four-month high as the heavyweight banking and petrochemical sectors weighed.
The kingdom's index slipped 0.4 percent, trimming January's gains to 4.2 percent.
Investors booked gains in the newly-listed Dallah Healthcare , which slipped 0.8 percent from Sunday's record high.
Petrochemical stocks declined with SABIC down 0.3 percent.
Saudi Kayan Petrochemical extended declines, dipping 1.2 percent, since saying its fourth-quarter net loss increased 1.9 percent from the year-earlier period.
Turnover was the highest in insurance stocks, as investors shifted focus from banks and petrochemicals. The insurance index dipped 0.7 percent.
"The Saudi market, in general, has been trading at a premium to other regional markets - this is shrinking (as other markets catch up)," said Ali Adou, portfolio manager at The National Investor. "You have an expansionary budget, which should translate to higher growth in loans. We're seeing about 15-16 percent loan growth, which has to be priced in the valuations."
Saudi Arabia has set a record state budget for 2013, at SR820bn ($219bn) as high oil prices allow heavy spending on welfare and infrastructure projects.
Elsewhere, Egypt's bourse rose 0.7 percent, halting two sessions of profit-taking as non-Arab foreigners resumed buying.
The market hit a 10-week peak on Wednesday at 5,866 points, but technical resistance offered a trigger for investors to then book gains.
Orascom Construction gained 1.2 percent and National Societe Generale Bank added 0.3 percent. These are the only two gainers, which help lift the market.
Most other stocks slipped. Non-Arab foreign investors were net buyers against Egyptian net sellers, according to bourse data.
In the UAE, Dubai's index climbed 0.2 percent, heading back towards Thursday's two-year high after Sunday's declines. Abu Dhabi's measure advanced 0.9 percent.