By Neeraj Gangal
UAE and Qatar's markets end lower as doubts over MSCI upgrade dampen sentiment
Petrochemical stocks weighed as Saudi Arabia's index ended lower for a second day, although some small-cap stocks rose, with investors targeting domestically driven stocks.
The index ended 0.2 percent lower at 6,273 points, extending declines since Sunday's four-month high.
Saudi Basic Industries Corp (SABIC) dipped 1.8 percent, Saudi Arabian Fertilisers fell 1 percent and Saudi Kayan Petrochemical shed 0.3 percent.
Analysts said investors are switching money into equities from property, buying into stocks in sectors dependent on local demand and government spending - such as agriculture and construction - to benefit from expected strong earnings.
Saudi Arabia's economy is forecast to grow 6.2 percent in 2011, according to a Reuters poll in September.
Agriculture and food stocks are among the most active, with Qassim Agriculture surging 9.7 percent, Saudi Fisheries up 0.3 percent and National Agricultural Development rising 4.2 percent.
UAE and Qatar's markets ended lower as doubts dampened sentiment on whether MSCI will upgrade the countries to emerging market status.
MSCI will announce its decision on late Dec 14, having postponed this from June. An upgrade from frontier market status could help attract foreign investment.
"Usually when a major event comes closer under uncertainty, people start speculating a few days before but the closer we get the more risk averse we become, unless a probability or information is leaked out," said Talal Touqan, head of equity research at Al Ramz Securities.
Dubai's index declined 0.6 percent to 1,388 points, extending year-to-date losses to 14.9 percent.
Emaar Properties shed 2.8 percent, Dubai Financial Market slipped 2 percent and Drake & Scull dipped 0.5 percent.
Abu Dhabi's benchmark eased 0.07 percent to 2,457 points.
Aldar Properties was the main drag, down 2 percent, and accounted for a third of all shares traded.
"Participants are shunning most of the illiquid small names and consolidating their holdings into other open-to-foreign liquid stocks," Touqan said.
In Qatar, the index slipped 0.1 percent to 8,798 points as investors booked profits in banking stocks.
Qatar National Bank shed 0.3 percent, Masraf Al Rayan dipped 0.9 percent and Qatar Islamic Bank slipped 0.5 percent.
Elsewhere, Oman ended on a 12-week high, as valuations pulled in investors, analysts said. The index climbed 1 percent to close at 5,664 points.