Deyaar climbed 8.8 percent and Union Properties added 7.3 percent. Tamweel's shares were suspended in November 2008, pending a merger with rival Amlak.

"Tamweel's announcement helped sentiment across the board and we saw concentration in the retail-orientated real estate companies like Deyaar and Union Properties," said Marwan Shurrab, vice-president at Gulfmena Alternative Investments.

"Today's gains are a retail move and not a fundamental move, but nevertheless UAE markets remain strong." 

Dubai's index rose 1 percent to 1,782 points — its highest finish since April 15, yet Mohammed Yasin, chief investment officer at CAPM Investment, was cautious.

"Speculators are circulating money from certain stocks to others that haven't moved and that usually happens toward the end of an upside move," said Yasin. 

Nevertheless, he said a few negative days should not scare investors.

"The momentum is still upwards," said Yasin. "Between now and the end of the year, there is still scope for gains. This will come from the macro picture, rather than company results."

Abu Dhabi's Sorouh Real Estate fell 2.2 percent after the developer's quarterly profit dropped 68 percent, hit by one-off expenses.

"For real estate companies, quarterly results are less of a concern than their balance sheet," said Majed Azzam, AlembicHC real estate analyst. 

"Sorouh has enough liquidity to continue with its development program and was able to raise money in the third quarter with a syndicated loan from Abu Dhabi banks as well restructuring some other debts.

"We are slightly worried by the slowdown in collection of receivables, which could ultimately affect its liquidity position."

The Abu Dhabi index fell 0.5 percent to 2,803 points.

Speculators helped Oman's Nawras rise 5.6 percent to 0.741 rials on the telecoms operator's bourse debut. Its initial public offering was priced at 0.702 rials.

"The IPO was at a good, competitive price, especially for long-term investors," said Shailendra Singh, head of asset management at Al-Shurooq Securities. 

"Retail investors might be sellers at 0.740 rials, but I don't see a sell-off from institutional investors at that level - the company is winning market share from Omantel and the downside is very limited from 0.702." 

The Omani index dropped 0.2 percent to 6,541 points.

Saudi Arabia's National Industrialization Co. (TASNEE) rose 3.2 percent to SR32.20 after HSBC upgraded the stock to overweight from neutral. The lender also upped its price target to SR40 from 33 riyals.

"This is a continuation of an optimistic trend towards petrochemicals, but the market is trying to forget the bank results," said a Riyadh-based analyst who asked not to be identified. "The market is changing direction within the same day and while there might be a short-term rally, I don't see it being able to gain more than 1 to 2 percent."

Rising provisions led to Saudi banks missing quarterly profit forecasts.

The Tadawul All-Share Index (TASI) rose 0.16 percent to 6,363.99  points. The sector activity for the day was mostly negative with 11 out of 15 sectors closing with losses ranging from 0.06 percent by the Insurance sector to 1.02 percent by the Industrial Investment sector. On the other side, the gains were witnessed only on four sectors ranging from 0.01 percent by the Retail sector to 1.29 percent by the Petrochemical Industries sector. The overall market breadth for the day was positive with 39 advancers against 76 decliners giving it an AD ratio of 0.51, the Financial Transaction House (FTH) said in its daily market commentary.

The stock market turnover reached SR2.80 billion on Monday

The Kuwaiti index rose 0.3 percent to 7,081 points.

The Qatari measure fell 0.3 percent to 7,770 points.

The Bahraini index eased 0.03 percent to 1,462 points.
 
— With input from agencies