Dubai's index made its largest gain in 10 months, rising 3.3 percent to 1,595 points, but trading is likely to remain volatile as speculators dominate and regional markets have yet to reclaim their early-week losses, according to Reuters.Emaar Properties climbed 5.8 percent and Drake & Scull added 6.1 percent. Both are active in Egypt. Dubai Islamic Bank rose 3.7 percent after Fitch Ratings gave the lender a stable outlook. "The turnaround is because we have a better reading of the political situation in Egypt," said Haissam Arabi, chief executive at Gulfmena Alternative Investments. "Gulf investors are worried about a contagion effect from Egypt," said Shankar Kailasam, Gulf Baader Capital Markets head of asset management in Muscat. "Hopefully, Egypt should near a solution in the next couple of days - as soon as that happens, investors will come back to Gulf markets."Nevertheless, many traders were worried about regional bank exposure to Egypt."A lot of private groups in the region have operations in Egypt and so banks will be exposed indirectly on top of any direct exposure, and this will have an impact," added Kailasam. National Bank of Abu Dhabi climbed 4.4 percent after its fourth-quarter profit surged, with investors seemingly little worried by the lender's warning that 2011 would be a "tricky" year for UAE banks. "We had some good news locally, with NBAD's strong profit growth and Fitch's rating for Dubai Islamic Bank, but we're still watching what is happening in Egypt and global markets on a day by day basis," said Samer Al-Jaouni, general manager of Middle East Financial Brokerage Co."Investor psychology is driving the market, rather than fundamentals, so we will see an up and down trend for at least the next week. This is a good opportunity for speculators, but for medium-term investors, the outlook is unclear." The Abu Dhabi index rose 1 percent to 2,624 points.Strong US manufacturing data boosted demand for Saudi petrochemicals stocks, with the latter seen as a proxy for world trade, helping the Kingdom's index advance for a third day in four, while global stocks hit fresh 29-month highs. The Tadawul All-Share Index (TASI) surged 2.2 percent to close at 6,513.28 on Wednesday. The sector activity for the day was all positive. The gaining sectors ranged from 0.95 percent by the Real Estate Development sector to 3.76 percent by the Petrochemical Industries sector. The overall market breadth for the day was positive with 135 advancers against 5 decliners giving it an AD ratio of 27, the Financial Transaction House (FTH) — licensed by the Capital Market Authority — said in its daily market report. The liquidity for the day reached SR4.21 billion.Saudi Basic Industries Corp. (SABIC) climbed 4.5 percent and Yanbu National Petrochemical Co. (Yansab) rose 4.9 percent. The Kuwaiti index climbed 0.2 percent to 6,819 points. The Qatari index slipped 0.02 percent to 8,739 points. The Omani index climbed 0.6 percent to 6,850 points. The Bahraini index fell 0.4 percent to 1,453 points.
