* Foreign, Gulf funds net sellers in Doha but at slower pace
* Finance minister says economy, currency stable
* Dubai's DSI up again; major shareholder sells stake
* Emaar technically strong
* Bounce in crude oil supports Saudi
By Celine Aswad
DUBAI, June 12 (Reuters) - Qatar's stock market rebounded on Monday from sharp falls last week after the finance minister said the economy was essentially operating as normal despite the region's diplomatic crisis, while property-related shares buoyed the United Arab Emirates.
Qatari Finance Minister Ali Sherif al-Emadi told CNBC that Doha could easily defend its currency and prevent shortages of food or other goods. Also, many investors still hope for a diplomatic solution in coming weeks.
The Qatari stock index rose 0.8 percent after it fell 1.9 percent on Sunday; it is still down 8 percent since last Monday, when Saudi Arabia and three other Arab states cut diplomatic and trade ties with Doha.
Foreign funds remained net sellers of Qatari shares on Monday but the pace of their selling slowed, bourse data showed, suggesting some funds were willing to accept higher political risk now that valuations were lower.
Telecommunications operator Ooredoo rose 2.1 percent to 92.90 riyals, an 18 percent discount to the average fair value estimated by 11 analysts surveyed by Reuters.
Non-Qatari Gulf funds have also slowed their pace of selling; on Monday they made up roughly 5 percent of total market turnover, in line with pre-crisis levels, bourse data showed.
Dubai's Drake & Scull climbed 2.4 percent; it has now risen 8.0 percent in unusually large volumes since Thursday. Former chief executive Khaldoun Tabari has sold his stake in the company to Tabarak Investment, a source told Zawya, a Thomson Reuters publication.
Tabarak Investment's stake stands at around 18 to 20 percent after the sale, making it the largest shareholder, Zawya said. In April, DSI said it would sell 500 million dirhams ($136 million) of shares to Tabarak as part of its capital restructuring programme, subject to regulatory approval.
A 3.0 percent gain in shares of the largest listed real estate developer, Emaar Properties, to 7.83 dirhams also helped to carry Dubai's index 1.2 percent higher.
The stock has been strong since last week when Emaar said it planned to distribute funds from a listing of its local real estate developer to shareholders. A second straight close above technical resistance at its December peak of 7.79 dirhams would confirm a break and target resistance at the April 2015 high of 8.39 dirhams.
In Abu Dhabi, its largest listed developer Aldar Properties was also strong, gaining 4.4 percent to its highest closing price since late March.
Dana Gas finished flat; the gas explorer has soared 48 percent this month on news that it received a portion of its overdue payments from Egypt and on hopes for its legal efforts to recover money from Iraqi Kurdistan. The Abu Dhabi index added 0.3 percent.
In Saudi Arabia, the index rose 0.2 percent as Brent oil prices recovered some of last week's heavy losses; eight of 14 listed petrochemical makers rose with Saudi Basic Industries up 0.5 percent.
Most blue-chip banks rose; National Commercial Bank added 1.2 percent.
Egypt's index fell 0.9 percent on profit-taking with the three shares that are members of the MSCI emerging market index dropping.
Commercial International Bank fell 1.6 percent, investment bank EFG Hermes lost 2.0 percent and Global Telecom declined 1.4 percent.
* The index rose 0.2 percent to 6,822 points.
* The index advanced 1.2 percent to 3,427 points.
* The index added 0.3 percent to 4,511 points.
* The index rebounded 0.8 percent to 9,135 points.
* The index fell 0.9 percent to 13,492 points.
* The index edged up 0.3 percent to 6,775 points.
* The index edged down 0.1 percent to 1,322 points.
* The index lost 0.3 percent to 5,314 points. (Editing by Andrew Torchia and Robin Pomeroy)