JEDDAH: Saudi Arabia’s bourse garnered solid gains ahead of the unveiling of the Kingdom’s 2016 budget, with investors betting on stocks expected to benefit from new economic policy including subsidy cuts, while other markets were mixed.

Saudi Arabia posted a 2015 budget deficit of SR367 billion ($97.9 billion) while spending rose 13 percent above the original 2015 budget plan, according to an adviser to the Council of Economic and Development Affairs, speaking about 30 minutes prior to the market closing.

This deficit makes up around 15 percent of gross domestic product.

Officials also announced that nonoil revenues increased 29 percent in 2015 to SR170 billion from SR133 billion in 2014.

This helped the Saudi index to close 0.7 percent higher, 8 points shy of the critical 7,000 levels, after trading broadly flat for much of the session.

Saudi Electricity Co. and National Gas and Industrialization Co, a distributor of liquefied petroleum gas, surged 9.9 and 9.6 percent respectively on speculation the 2016 budget would include reforms such as cutting back subsidies for electricity, water and natural gas.

Next year’s budget, announced after the market close and forecasting a budget deficit of SR326 billion, did mention reforms to energy and other subsidies will be carried out gradually over the next five years.

Such news could impact petrochemical and cement stocks in coming sessions, as their bottom lines will likely be squeezed as they are heavily dependent on government subsidising costs.

Saudi Cement, the Kingdom’s largest cement firm by market value, closed down 3.6 percent.

Dubai’s index fell 1.3 percent as day traders turned a quick profit and sold blue chips, erasing all of the market’s gains in the previous session.

Emaar Properties and bank Emirates NBD, stocks which had dragged the market higher on Sunday, fell 1.6 and 0.7 percent respectively on Monday.

Real estate-related firms were also losers: Damac Properties declined 3.8 percent and contractor Arabtec slipped 3.2 percent.

Investors largely brushed off the positive impetus from the planned fiscal expansion in 2016 announced late on Sunday.

Dubai’s budget plans on increasing spending by 12 percent in 2016 compared to 2015 as the emirate invests in infrastructure to sustain economic growth, while continuing to balance its budget.

Abu Dhabi’s exchange edged up 0.1 percent, climbing for an eighth session in a row, in thin trading as international investors were away on year-end holidays.