By Matt Smith
UPDATE 6:Abu Dhabi index ADI edges up to 4-week high; Dubai declines.
Saudi Arabia's index TASI ended higher for the third session in four, rebounding from the previous day's five-week low as rising oil prices help Saudi Basic Industries Corp (SABIC) advanced.SABIC climbed 0.3 percent, and the index climbed 0.4 percent to 6,225 points.
Both oil and crude had fallen 5 percent over the preceding three weeks. Crude was up 0.5 percent at $74.10 a barrel at 1239 GMT, bouncing from earlier losses, as the euro extended gains against the dollar on hopes for a bailout for Greece.
Saudi Arabian Fertiliser Co (Safco) climbe 5.4 percent.
Dubai's index DFM declined for a second time this week as uncertainty over Dubai's debt position spurred selling, with Emaar Properties tumbling ahead of its full-year earnings. Emaar Properties fell 4.3 percent in its biggest decline for two weeks, a day before the developer is expected to release its results. Dubai Financial Market DFM dropped 3.1 percent and Deyaar lost 2 percent.
"I think Emaar's numbers are pretty much already priced in - we can have a good guess as to what its earnings will be, but just need to confirm there aren't any surprises," said Ahmed Hamdi, Senior relationship manager at Prime Emirates.
The market opened positively, but then fell as a UAE newspaper said indebted state-linked conglomerate Dubai World intends to ask creditors for a six-month standstill on $22 billion in debt this month.
"We really have no liquidity in our markets because of the uncertainty of the debt negotiations and its effects on banking sector," says Mohammed Yasin, Shuaa Securities chief executive.
"Therefore, small time day traders are trying to make some money on intraday trading on margin. They need to close their positions in a few days if not a few hours. Regardless of what the fundamentals are, they want to trade."
The index dropped 1.2 percent to 1,641 points.
Abu Dhabi Commercial Bank was the main support as the UAE capital's benchmark ADI hit a four-week closing high, outweighing property sector declines.
ADCB climbed 3.4 percent to claw back early week losses. Fellow lender First Gulf Bank added 1.6 percent, but Aldar Properties and Sorouh Real Estate each lost 1.7 percent.
The index edged up 0.2 percent to 2,725 points, its third straight gain and highest finish since Jan. 12.
"The market is lacking any significant news," said Ahmed Hamdi, Senior relationship manager at Prime Emirates.
Qatar National Bank rallied, helping Doha's benchmark QSI end higher for a third day.
QNB climbed 2.4 percent. It was flat the day before, helped by Qatar's use of closing average prices, with the stock under pressure as investors sold up after it went ex-dividend.
Commercial Bank of Qatar fell 7.1 percent after itself going ex-dividend, while the lender also increased its share capital by 4.8 percent.
The index climbed 0.9 percent to 6,825 points.
"The resistance at 6,850 remains in place and until it is decisively cleared, there will be little incentive to take major bets," Shuaa Capital wrote in a research note.
Kuwait's index KWSE rose for an eighth straight session, hitting a fresh 13-week closing high and heightening expectations for a sustained uptrend.
Agility dropped 3.1 percent and Ahli United Bank fell 1.2 percent.
National Industries Group was the main support rising 3 percent. The Kharafi group is the major shareholder in both NIG and Zain. The latter ended flat after gaining 18 percent in the previous three sessions.
"Liquidity has started to strengthen and these extra volumes are coming from local investment houses," says Ammar Hajeyah, assistant vice-president at Global Investment House.
"Institutions and fund managers have started to deploy cash based on Kuwait's macro picture after the government announced its spending plans.
"At the end of January, some portfolios were sitting on 35-40 percent cash and after the positive news from the government, they have started to put some of this into the market."
Earlier this month, Kuwait said its spending for the 2010-2011 fiscal year would be $55.6 billion. The new budget includes spending on projects in the government's development plan, which runs until 2014 and aims to decrease the country's dependence on oil.
The index edged up 0.1 percent to 7,169 points, its highest finish since Nov. 10.
"Some regional funds that were underweight on Kuwait are upgrading Kuwait to neutral," adds Hajeyah.
Bahrain's measure BAX rose 0.3 percent to 1,519 points, a new 15-week high.
Oman's index MSI made its largest gain for two weeks as banks rallied.
Bank Muscat climbed 1.4 percent, Bank Dhofar added 1.2 percent and National Bank of Oman rose 0.9 percent.
"For me, i'm looking at the volumes -- stocks may be going up, but volumes are not what they should be," says Sayed Quadry, vice-president of business development at Amwal Investment in Muscat.
"January and February are results and dividends season and so we would expect bigger trading. The more informed investors are looking for a really positive signal to come in, so the smaller players are dominating the market at the moment."
The index climbed 0.8 percent to 6,562 points. (Reuters)