UPDATE 5: Banks help Kuwait's KWSE end higher for 2nd session in three in brisk trading.
Arabtec and Aabar Investments surged ahead of a board meetings after market hours, lifting the Dubai DFM and Abu Dhabi benchmarks, while trading in most other stocks was muted.Arabtec climbed 6.3 percent and Aabar added 7.9 percent.
There were market rumours in late December regarding a possible investment by Aabar in the Dubai-based construction firm, but both firms have moved to deny there has been a deal.
Arabtec was Dubai's top trader, accounting for more than a third of all shares change hands as volumes hit a 2010 high.
Emaar Properties climbed 0.3 percent after a topsy-turvy session, while Union Properties jumped 4.2 percent.
The index climbed one percent to 1,837 points, its fourth rise in five sessions, shrugging off reports that a consortium of four Japanese companies and one Turkish company will suspend construction of the Dubai Metro due to a delay in payment from the Dubai government.
"The market was already aware Japanese companies were owed money, but we need more clarity on how much is outstanding," said Ali Khan, managing director and head of brokerage at Arqaam Capital.
Apart from Aabar, Abu Dhabi bluechips moved sideways, with First Gulf Bank the biggest gainer, rising 1.2 percent.
The index climbed 0.3 percent to 2,776 points.
"The markets have been flat apart a strong start to the week - the first's day trading of the year - but we will have to see what news comes out over the weekend and how oil and international markets perform before we can say what will happen next week," added Khan.
Banks helped Kuwait's index KWSE end higher for a second session in three in brisk trading, while Qatar's benchmark QSI also rose.
National Bank of Kuwait climbed 3.7 percent. Kuwait Finance House rose 1.8 percent after a newspaper report said the Islamic lender plans to set up a $250 million real estate fund to invest in Canada.
Zain was unchanged. Sale talks were ongoing, a firm owned by major Zain shareholder, the Kharafi group, said on Thursday. In September, Kharafi said it had agreed to sell a 46 percent stake in Zain to an Indian-led consortium.
Kuwait's index rose 0.6 percent to 7,012 points, a week-high as volumes more than double to reach their highest level since Dec. 17.
Industries Qatar added 0.7 percent, pushing Qatar's index to its third straight gain and helping to offset a 0.7 percent drop in Qatar National Bank.
"The expectations for Qatar outweigh the current reality (of the Doha market), but the top-down picture is still very good," says Julian Bruce, EFG-Hermes director of institutional equity sales.
"Banks have plenty of government support, but trading is sideways and Qatar is the remaining overlooked market in the Gulf."
The index climbed 0.1 percent to 7,037 points, a two-week high.
Bahrain's measure BAX edged higher for a second session day in three, rising 0.2 percent to 1,451 points.
Bank Muscat surged to a seven-week high, boosting other Oman shares as the index MSI rallied for a 10th session in 11.
Bank Muscat climbed 4.8 percent to its highest level since Nov 17.
"Other Oman banks don't have as big international exposure as Bank Muscat, so investors were worried about its exposure to Dubai, Bahrain and Saudi Arabia and so on," said Sayed Quadry, vice-president of business development at Amwal Investment in Muscat.
"But it's the strongest bank (in Oman) and at these levels I'm definitely a buyer for the medium- to long-term."
The index climbed 1.2 percent to 6,562 points, a 10-week high. Oman Telecommunications Co (Omantel) added 1.6 percent and National Bank of Oman rose 1.2 percent.
"Bank Muscat has boosted sentiment for other stocks -- people are expecting better results this year," added Quadry. (Reuters)