July 3, 2017 / 8:06 AM / 7 months ago

MIDEAST STOCKS-Qatar stabilises after diplomatic deadline extended, Saudi cools

DUBAI, July 3 (Reuters) - Qatar’s stock market stabilised in early trade on Monday after a diplomatic deadline to comply with demands by four Arab states was extended by two days to Tuesday night.

Kuwait’s foreign minister arrived in Kuwait, which is acting as mediator, to respond to the demands. There is still no clear sign that Qatar will accept enough of the demands to satisfy the four states or that the dispute will be resolved.

If not, fresh sanctions could be imposed - Saudi Arabia’s Okaz newspaper reported that the boycotting countries would ask international companies to choose between doing business with them or with other countries.

But the Doha index, which fell 2.3 percent on Sunday, was up 0.3 percent after an hour of trade as some stocks favoured by foreign funds were the top gainers. Mobile phone operator Vodafone Qatar rose 1.1 percent.

Foreign funds have been taking advantage of reduced valuations in the Qatari market because of its recent plunge and have been net buyers of Qatari shares in the last two sessions, according to bourse data.

In Dubai, the index was up 1.3 percent as 24 shares rose and only two declined. Shares favoured by short-term retail traders were the most active, with GFH Financial adding 4.4 percent and property developer DAMAC jumping 5.3 percent.

Abu Dhabi’s index dipped 0.2 percent, weighed down by the top two shares by market value; telecommunications operator Etisalat, down 0.6 percent, and First Abu Dhabi Bank , off 0.5 percent.

In Saudi Arabia, the index edged down 0.3 percent, snapping three days of strong gains. National Commercial Bank retreated 2.0 percent, pulling away from a 21-month high.

Petrochemical shares, however, were firm as Brent oil headed back near $50 a barrel. Nine of the 14 listed producers rose; Alujain was the best performer, adding 1.4 percent. (Reporting by Celine Aswad; Editing by Andrew Torchia and Andrew Heavens)

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