"Markets are cheap, but that's not to say they can't get cheaper in the coming days," said Matthew Wakeman, EFG-Hermes managing director for cash and equity-linked trading.
Saudi Arabia unveiled a $35 billion social spending program, boosting regional sentiment, although the Kingdom's bourse ended lower, declining for a ninth session on Wednesday.
The Tadawul All-Share Index (TASI) ended 0.21 percent lower at 6,263.79. The sector activity for the day was all negative except 3 gaining sectors. The losing sectors ranged from 0.13 percent by the Real Estate Development sector to 2.91 percent by the Multi-Investment sector. On the other hand the gaining sectors were the Cement sector, the Agriculture & Food Industries sector and Banks & Financial Services sector with 0.03 percent, 0.29 percent, and 0.66 percent respectively. In addition, the Retail sector had no change. Overall market breadth for the day was negative with 26 advancers against 98 decliners giving it an AD ratio of 0.26, the Financial Transaction House (FTH) — licensed by the Capital Market Authority (CMA) — said in its daily market report.
The liquidity for the day reached SR3.72 billion.
Kuwait's benchmark climbed 0.8 percent to 6,467 points, its biggest gain in four months and Dubai eased away from Tuesday's six-month low, rising 1.3 percent to 1,499 points. The Abu Dhabi index climbed 1.1 percent to 2,608 points.
Emirates NBD climbed 4.7 percent and Dubai Financial Market rose 3.3 percent, while Aramex added 4.6 percent after it bought an Irish firm to expand its freight capabilities in Europe.
"Volatility is not in volumes, but in prices," said Samer Al-Jaouni, general manager of Middle East Financial Brokerage.
"People are watching the news and not looking at fundamentals or technicals - they are afraid and so it's a very thin market. With the tensions in the region, it's difficult to make a rational investment decision."
This meant that day traders and swing traders dominate, with longer-term money remaining aloof, so Wednesday's rebound may prove short-lived.
"It's a reaction to what happened in Saudi. We will have to see how things develop politically," said Jaouni.
Oman's index slumped to a two-month low. Bank Muscat dropped 2.2 percent and Renaissance Services fell 3.7 percent. The Omani index fell 1.1 percent to 6,656 points.
"Foreign selling in the market accelerated today," said Joice Mathew, United Securities head of research.
The Qatari index slipped 0.1 percent to 8,177 points.
The Bahraini index rose 0.3 percent to 1,473 points.
