Zain slipped 2.9 percent, helping drag the Kuwait index down 0.47 percent to its lowest since Sept. 28.

“There are some concerns now the whole sale could be postponed,” said a Kuwait trader on condition of anonymity. Zain “need to sell off Zain Saudi to complete the deal with Etisalat, and it’s looking a little difficult at this point.”

After trading closed on Thursday, sources familiar with the situation said Zain had appointed UBS to sell the Saudi business.

Regulators require that sale to allow Etisalat’s bid for a controlling stake in the parent firm to pass.

As Kuwait declined, the Qatar, Oman and Egyptian indexes registered gains of 0.68 percent, 0.4 percent and 0.1 percent, respectively. Markets in the United Arab Emirates and Saudi Arabia were shut for public holidays.

Traders said Middle Eastern stocks were catching up with the US Dow Jones Industrial Average, which saw its biggest gain in three months on Wednesday on investor relief at efforts to resolve the European Union’s sovereign debt crisis.

Egypt investors continued picking up shares in smaller housing companies after Amer Group posted nine-month profit that boosted confidence in the sector, traders said.

The newly listed property development and business services conglomerate said its nine-month net profit rose 7.5 percent to to 422 million Egyptian pounds ($73 million).

“Investors see hope in the real estate market based on the positive results of Amer Group,” says Margo Moussa, an analyst at Arab Finance Brokerage. Investors “are targeting small-cap housing stocks because they don’t feel they will reap as much from big-cap housing stocks.”

United Housing was Egypt’s fifth most traded stock.

Small caps Egypt Housing and El Kahera Housing were among the top 10 traded stocks on the Egyptian Exchange, closing up 2.5 percent and 2 percent, respectively.

Amer dipped 2.5 percent to 2.76 pounds per share compared with its initial public offering price last week of 2.8 pounds.

Traders said a fall in the stock on Wednesday led to more selling by investors concerned that Amer would repeat a pattern of declines by some firms in the weeks after their listing.

“An investor will stop losses at this level instead of continuing losses as happened in previous IPOs like Palm Hills and Juhayna,” said Heba Salah of Arab Finance Brokerage.