JEDDAH: Gulf stock markets extended their losses as Brent crude plunged for a second session in a row and the threat of a fresh euro zone crisis in Greece also prompted investors to sell risky assets globally.

MSCI’s emerging market index fell 1.0 percent to a three-week low.

Saudi Arabia’s Tadawul All Share Index dropped as much as 4.0 percent in a broad sell-off early in the session, but then pared its losses and closed only 0.6 percent down.

The Kingdom’s market is heavily weighted toward petrochemicals, whose profit margins will suffer from cheaper crude. The sector was the main drag on the bourse as it fell 1.2 percent.

But dozens of stocks closed in the black and Makkah real estate developer Jabal Omar was the main support, jumping 2.2 percent after it secured a SR4 billion ($1.1 billion) loan to refinance part of an existing facility.

The broad market’s recovery followed a speech by Custodian of The Two Holy Mosques King Abdullah — read on his behalf by Crown Prince Salman, deputy prime minister and defense minister, on state television — in which the King said Saudi Arabia would deal “with a firm will” with the challenge posed by lower oil prices.

Also, a survey of companies showed that growth in Saudi Arabia’s nonoil private sector had accelerated slightly in December, driven by an expansion in output, though it remained weaker than it was in most of 2014.

“The rise in December’s whole economy PMIs suggests that, in spite of the plunge in oil prices at the end of last year, economic activity in the Gulf has held up reasonably well,” Jason Tuvey, Middle East economist at London-based Capital Economics, said in a note.

The Kingdom adopted a large 2015 state budget last month which provides for a marginal increase in spending rather than a cut as some retail investors had previously feared.

Dubai’s bourse led losses in the Gulf, dropping 3.2 percent. Emaar Properties, the emirate’s largest listed developer, topped trading volume as it lost 5.8 percent.

However, shares in Air Arabia bucked the trend and added 1.4 percent after the firm said on Monday it had bought a 49 percent stake in Jordan’s Petra Airlines and would establish a hub in the country.

The carrier may also benefit from the sustained drop in oil prices.

Dubai’s nonoil business activity growth also edged up in December.

But the emirate’s bourse, which unlike Saudi Arabia’s is open to direct foreign investment, has been hit in recent days by a global pullout from emerging markets. Foreigners from outside the Gulf were again net sellers on Tuesday, bourse data showed.

Elsewhere in the Gulf, Abu Dhabi’s index fell 2.7 percent, Kuwait lost 1.5 percent and Oman’s bourse slipped 1.3 percent.

Egypt’s market dropped 2.4 percent.

As an oil importer, Egypt should benefit from cheaper crude, but its equities are also vulnerable to global emerging market flows and Cairo’s government relies heavily on financial aid from the oil-exporting Gulf states, which could conceivably shrink if they become more cautious about spending.