* Relief from Russia-Ukraine easing short-lived
* Surprise move against Qatar scares retail investors
* Qatar's index posts biggest drop in more than 6 months
By Nadia Saleem
DUBAI, March 5 Qatar's shares led a decline in
most Gulf markets on Wednesday after Saudi Arabia, the United
Arab Emirates and Bahrain said they would withdraw envoys from
Doha over what they called interference in their internal
The move, conveyed in a joint statement by the three
countries, is unprecedented in the three-decade history of the
Gulf Cooperation Council, a pro-Western alliance of Saudi
Arabia, Bahrain, Kuwait, Qatar, the UAE and Oman.
Most Gulf markets reversed early-session gains driven by
relief over Ukraine before Gulf tension hit investors sentiment.
"It's a diplomatic agreement at this stage to show a
dissatisfaction with polices - I don't see a threat to
commercial or economic ties between the GCC at this moment,"
said Abdullah Alawi, assistant general manager and head of
research at Aljazira Capital.
Doha's measure dropped 2.1 percent in its biggest
one-day loss in more than six months. Non-Qatari investors were
net sellers as well as Qatari individual investors.
"It's retail-driven panic selling, it's too early to say if
this would have an impact on fund allocations for institutional
investors, because we don't know how the situation will evolve,"
said Ali Adou, portfolio manager at The National Investor.
Telecommunications firm Ooredoo was hit the worst;
the stock nosedived 7.0 percent after the company posted a 36
percent drop in fourth-quarter net profit and missed two
Saudi Arabia's share index was choppy but managed to
close in the black, up 0.1 percent.
The selling spread to the United Arab Emirates, where
Dubai's measure slipped 0.5 percent. Small-cap shares
suffered the most, while blue chips were steady. Abu Dhabi banks
helped support the emirate's benchmark, which ticked up
0.4 percent after a volatile session.
"Investors are of two minds on whether this is a short-term
pullback or will this continue," said Sanyalaksna Manibhandu,
senior analyst at NBAD Securities. "People are not rushing to
sell key stocks. I would suggest this is an over-reaction based
on the GCC being a fairly united unit for a few years."
Shares in RAK Ceramics gained 2.8 percent after a
source told Reuters that its top shareholder, the ruling family
of Ras Al Khaimah, was exploring a possible sale of all or part
of its stake in the firm.
In Egypt, investor sentiment was buoyed after army chief
Field Marshal Abdel Fattah al-Sisi, widely expected to win the
presidency of the Arab world's most populous country, gave his
clearest signal yet that he would run for president.
He could not ignore the demands of the "majority", he said
late on Tuesday.
Cairo's benchmark index rose 1.1 percent, taking
year-to-date gains to 18.3 percent.
* The index tumbled 2.1 percent to 11,347 points.
* The index gained 0.1 percent to 9,161 points.
* The index slipped 0.5 percent to 4,101 points.
* The index climbed 0.4 percent to 4,938 points.
* The index rose 1.2 percent to 8,025 points.
* The index retreated 0.7 percent to 7,477 points.
* The index gained 0.5 percent to 7,129 points.
* The index slipped 0.2 percent to 1,365 points.