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Sun 14 Dec 2008 11:11 AM

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Gulf stocks reverse early gains to close lower

UPDATE 4: Investors concerned economic impact of global credit crisis could be get worse.

Most Gulf Arab markets reversed early gains to end the day lower on Sunday due to fears the economic impact of the global credit crisis on the region could be worse than first thought.

Markets in the United Arab Emirates closed lower, paring gains from Thursday.

In Dubai, Emaar Properties and Emirates NBD led losses, falling 1.62 percent and 2.78 percent respectively. The index fell 1.33 percent to 1,960 points.

Shares of Emirates Telecommunications Co. (Etisalat) and National Bank of Abu Dhabi (NBAD) weighed in the capital, falling 1.2 percent and 3.95 percent respectively.

The benchmark closed 0.86 percent down at 2,733 points.

Saudi stocks pared gains from Saturday as investors booked profits ahead of fouth quarter results and the announcement of the government's 2009 budget due in the last week of December.

The top 10 stocks all slipped, pushing the index 1.15 percent lower to 4,791 points.

"In view of the cloudy outlook with the financial results in the next two weeks, the markets will be volatile," said Hisham Tuffaha at Bakheet Investment Group.

Tuffaha added that investors were also waiting for the 2009 budget to be released on Dec. 22 to get an idea of future Saudi Arabian expenditure.

Saudi Basic Industries Corp shed 0.85 percent and Al-Rajhi bank fell 2.5 percent.

Kuwait's main index, the Gulf Arab region's best performing market this year, inched 0.05 percent lower to 8,910 points, led by National Bank of Kuwait (NBK), which fell 1.3 percent.

Banks led declines in Muscat amid low volumes as investors held back ahead of fourth quarter earnings' results next month and as they await a government fund to shore up stock markets.

"The market is down on low volumes as people are watching and waiting for the new fund to come in and results for the year which will come soon," said Hassan Tawfiq, senior broker at United Securities.

Bank Muscat, down 56 percent this year, ended 2.63 percent lower and National Bank of Oman fell 2.1 percent.

The index closed 0.67 percent lower at 6,096 points.

Banks led gains in Doha, which along with Bahrain bucked the regional downward trend, as investors deem valuations cheap ahead of 2008 cash dividend payouts.

Qatar's index extended gains into a third day, ending 2.55 percent up at 6,420 points.

"It's the banking sector and the amended cash dividends," said Amro Motasim, chief trader at Ahli Bank. "We're getting closer to the due date and the cash dividends are really good.

"With prices dropping so much stocks have become attractive."

Commercial Bank of Qatar and Qatar Islamic Bank gained 6.22 percent and 3.3 percent respectively.

In Bahrain, Albaraka Banking Group jumped 5.77 percent, helping the index reverse earlier losses, closing up 0.48 percent at 1,932 points.

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