By John Irish
UPDATE 5: Merger boosts Qatar in reverse of overall downward trend.
Shares of Emaar Properties weighed on Dubai's main benchmark, as a sharp decline in oil prices on Wednesday, and global market falls, hit economic woes of UAE markets.
Emaar fell 7.28 percent to 2.42 dirhams reversing gains from Wednesday. Dubai Financial Market ended 5.63 percent down.
Oil fell 12 percent on Wednesday to $42, while markets Asian, European and US markets all fell.
In Abu Dhabi, Emirates Telecommunications Co and National bank of Abu Dhabi weighed, falling 1.42 percent and 0.5 percent respectively.
The index closed 0.54 percent lower at 2,527 points.
Qataris main index bucked the downward trend in the Gulf Arab region as investors bought after three days of declines and a merger plan boosted confidence.
Gulf Warehousing Co led gains on news it is planning to merge with the Qatari unit of Kuwaiti logistics provider Agility. It gained 8.6 percent.
Commercial Bank of Qatar ended 3.8 percent higher.
"It's a normal bounce after three days of declines," said Amro Motasim at Ahli Bank.
The index ended 2.21 percent at 6,432 points.
Bahrain's benchmark ended 0.69 percent lower at 1,780 points. Ithmaar Bank fell 8.51 percent down.Shares of Global Investment House leds Kuwait's index to a lower end after the investment bank said it had defaulted on most of its debt.
Global slumped 6.58 percent, adding to almost two weeks of declines as the crisis of investment firms hit by the global credit crunch widened in the Gulf Arab state.
"Global has been acting like this because of speculation it will go bust," said Jasem al-Zeraei, supervisor of brokerage at National Bank of Kuwait.
Global has shed almost 20 percent since Dec. 22. Investment Dar also ended 6.17 percent lower, driving Kuwait 0.76 percent down at 7,371 points.
Oman's main index closed lower on the back of declining oil prices and low volumes as investors awaited news of a government fund to invest in the bourse.
The index slipped 0.63 percent to 5,427 points led by Bank Muscat and Raysut Cement CO, which fell 1.98 percent and 0.26 percent respectively.
"As expected a fall in oil price and an absence of local institutions in the market reflected on the volumes," said Adel Nasr at Muscat-based United Securities. "Most traders are still waiting on the stabilisation fund."
Oil closed 12 percent lower on Wednesday at about $42, although it made gains on Thursday after violence in the Gaza and the Levant escalated. Shares of Gulf Warehousing Co surged almost 10 percent in Doha after it said on Wednesday it planned to merge with the Qatari unit of Kuwaiti logistics provider Agility.
"Gulf Warehousing is up on the merger news," said Amro Motasim, chief trader at Qatar-based Ahli Bank.
The stock, down 4.62 percent since the start of the year, gained 9.68 percent, helping lift Qatar's benchmark 2.52 percent to 6,451 points.
The merger aimed to create one of the biggest companies dealing in providing services of storage, transportation, handling, customs clearance and all other comprehensive, Gulf Warehousing said in a statement.
Agility gained 1.52 percent in Kuwait, outperforming the market which was down 0.91 percent at 7,361 points.
Qatar's index gained after three days of sharp declined, said Ahli's Motasim. "It's a normal bounce back.
However, traders predicted that Gulf Arab markets were unlikely to see any impact from escalating violence in Gaza, Lebanon and Israel as investors deem the crisis as localised rather than regional. Israel fired artillery at Lebanon on Thursday in response to rockets fired at northern Israel, the Israeli army said on Thursday.
Israeli warplanes bombed targets across the Gaza Strip and tanks advanced on Palestinian guerrillas as U.S. backing for a truce proposal raised expectations of an end to the offensive.
It will "absolutely not" impact the Gulf Arab markets, said one Doha-based trader. "Investors consider the news to be local ... it's not the first time and has been going on for 60 years," said one Doha-based trader.
Shawkut Raslan, head of brokerage at Prime Emirates in Abu Dhabi said escalating violence was having a limited affect on Gulf Arab markets.
"I don't think there is political risk," he said. "It's not new news."
Asian markets also fell on Thursday as economic fears weighed on investor sentiment.
Saudi Arabia's bourse, the Arab world's largest, closed higher for a ninth day on Wednesday, while real estate stocks rose in UAE markets. (Reuters)For all the latest market news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.