DUBAI: Most Gulf bourses fell on Thursday, as a revolt against Libyan leader Muammar Gaddafi continued and fear of a contagion in the Middle East prompted investors to exit markets.
A proposal by Venezuela President Hugo Chavez to try to broker a peace deal in Libya briefly pushed oil prices lower and briefly helped stocks markets make some gains. But the benefit was short-lived amid reports of continued fighting in Libya, including air strikes against rebel positions.
The Saudi bourse was closed on Thursday, the start of the Saudi weekend, but a sharp fall on the region’s most influential market a day earlier still weighed on the Gulf.
Dubai was the biggest loser on Thursday, as its index fell to a new 6-1/2 year low, ending 1.6 percent lower.
"The geopolitics of the region is a major concern for investors," said Marwan Shurrab, vice president and chief trader at Gulfmena Alternative Investments.
"Traders will still prefer to stay on the sidelines. News of the peace deal did move the markets a bit but traders are not fully convinced. There is no catalyst for a rally."
Heavyweight Emaar Properties fell 3.6 percent and Dubai builder Arabtec dropped 4.9 percent.
In Qatar, Islamic lender Masraf Al Rayan sagged 7 percent as the Doha index was also weighed down by regional political unrest.
"Qatar gained initially, but at very low volumes. As volumes grew, the shares fell," said Shurrab.
The Doha index ended down 2.2 percent, its lowest value since Sept. 8.
Kuwait’s Zain made its biggest gains in more than five months after the UAE’s Etisalat said on Wednesday that it was still interested in buying a controlling stake in the company for $12 billion.
Zain climbed 4.7 percent to 1.3 dinars.
Etisalat, which offered 1.7 dinars a share for the stake to a consortium led by Kuwaiti conglomerate Kharafi Group, missed its due diligence deadline this week.
"The Kharafi group is probably pretty frustrated by the relatively slow progress of due diligence, with Etisalat missing various deadlines," said Martin Mabbutt, Nomura telecoms analyst.
"Whether the deal is off, we simply don’t know. If I was a shareholder and I had already pledged my shares to Etisalat, I would be pretty happy with the price agreed."