Other Middle East markets were subdued, with little for investors to trade on now the quarterly results season is all but over.
The Saudi index hit a 19-month intraday high, but this sparked profit-taking and it ended 0.1 percent lower at 6,886 points.
The sector activity was widely negative with only two sectors — Banks & Financial Services and Petrochemical Industries — closing with gains. Losses ranged from 0.3 percent in the Cement sector to 1.33 percent in Multi-Investment. The overall market breadth was negative with 36 advancers against 89 decliners giving it an AD ratio of 0.40, the Financial Transaction House (FTH) said in its daily market commentary.
Some traders said the index is likely to correct to 6,600 points by early June, but if second-quarter earnings meet upbeat expectations, it would then rally to break 7,000 points.
“Saudi Arabia will continue to do well in the medium term,” said Adel Nasr, United Securities brokerage manager in Muscat.
“Petrochemical results were very good and the bank sector will also rebound, while commodity-related stocks like Maaden and Saudi Cable Co. will outperform.”
Saudi Arabian Mining Co. (Maaden) fell 1.6 percent and Saudi Cable dipped 0.5 percent.
Saudi investors are looking to the reaction of US and Asian markets to China's steps to cool its economy, the manager said, because this may impact demand for oil and petrochemicals.
Worries about the eurozone sovereign debt crisis, weighed on world stocks, while the euro hit a one-year low.
Vodafone Qatar, which will join Doha's reshuffled index from Thursday, climbed 1.1 percent to a seven-month high, as 7.8 million shares were traded, double the index total. Vodafone is up 18.1 percent since being awarded a fixed-line license on March 30.
Dubai's index ended 0.3 percent higher, having been up as much as 1.7 percent intraday.
“We're still waiting for the Dubai World issue to be resolved -- there are no long-term investors in the market, its all day traders, which is causing high volatility,” said Nasr.
Zain ended flat after hitting a three-week intraday high. It is up since Gabon's government backed the sale of Zain Gabon to Bharti Airtel, part of Zain's $9 billion asset sale to the Indian operator.
"Zain is starting to move up as we get nearer the completion of its asset sale and more liquidity will come in once it approves its 2009 dividend," said a Kuwait trader who asked not to be identified. "People are shunning the market because there's no need for them to buy -- prices aren't going anywhere."
-- With input from agencies
