(MENAFN- Gulf Times) Most Middle East stock markets rose but closed well off their intra-day highs yesterday and some edged lower as investors started selling into the region's rally, indicating sentiment was still shaky even after oil prices rebounded.
The Qatar Stock Exchange's benchmark index gained 0.4% to close 11,340 points. Petrochemicals and steel conglomerate Industries Qatar jumped 2.5% and was the main support for the Doha benchmark.
Saudi Arabia's main index, which surged as much as 4.6% early in the day, closed just 1.1% higher. That left the index up 11% from a 29-month low hit last Monday, but still 15% below its level at the end of last month.
The petrochemical sector, up 3.2%, was the main support yesterday after Brent oil climbed above $50 per barrel on Friday. The sector's margins are directly affected by oil prices and leading petrochemical producer Saudi Basic Industries surged 4.0%.
But some stocks went into the red late in the session, such as Al Tayyar Travel, which tumbled 5.8%, and Banque Saudi Fransi, down 2.5%.
Shakeel Sarwar, head of asset management at Securities & Investment Co (Sico) in Bahrain, said markets in the region were likely to remain jittery until oil prices stabilised.
"Right now I think the situation is so fluid, it becomes extremely difficult to build a solid investment case," he said.
Trading volumes in Riyadh fell for a third session in a row, another indication that the recovery was fragile. With low oil prices pushing state finances deep into the red, the Saudi government has not yet released a detailed plan for how the world's top oil exporter would handle an era of cheap oil that could last for years.
Elsewhere in the region, Dubai's stock index closed 1.1% higher after jumping as much as 3.2% in early trade.
Developer Damac was the most traded stock, surging 7.0% after the firm called a shareholder meeting for September 15 to approve its first cash dividend of 10% since it listed in Dubai in January.
Most other actively traded stocks were also from the property or related sectors. Heavyweight developer Emaar Properties jumped 2.8%, Union Properties rose 1.5% and mortgage lender Amlak Finance added 1.4%.
In addition to oil's rebound late last week, property stocks may be supported by hopes that the US Federal Reserve will postpone an interest rate increase which analysts had previously expected in September.
Those Fed officials who are anxious to raise rates said at an annual global central bankers' conference on Friday that continued market turmoil might lead the US central bank to delay tightening monetary policy. Most Gulf states keep their currencies pegged to the dollar and replicate the Fed's interest rate adjustments.
Ports operator DP World rose 5.7%, adding to Thursday's 8.7% gain. It has outperformed the market since Thursday, when the company said it might launch operations in Iran; it is one of a handful of listed logistics and transport firms in the Gulf that could benefit from the lifting of international sanctions against Iran.
Abu Dhabi's index slipped 0.2%,
Egypt's bourse slipped 0.3% as most blue chips pulled back after rising for three sessions in a row. But Pioneers Holding surged 6% after soaring 10% on Thursday, when it reported its second-quarter profit had more than tripled.
Elsewhere in the Gulf, Kuwait's index rose 0.5% to 5,904 points; Oman's index climbed 1.5% to 5,904 points, while Bahrain's index inched down 0.1% to 1,301 points.
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