October 1, 2018 / 1:56 PM / in 2 years

MIDEAST STOCKS-Egypt falls on currency worries, Saudi and UAE rise

* 25 of 30 stocks fall in Egypt blue-chip index

* Reuters poll finds fund managers turning negative

* Dubai's Drake & Scull rises in heavy trade

* Banks lift Abu Dhabi

* Bahrain's Khaleeji Commercial tumbles after CFO resigns

By Abinaya Vijayaraghavan

Oct 1 (Reuters) - Egypt's stock index fell 1.2 percent on Monday because of concerns that its currency could be vulnerable, while Saudi Arabia and United Arab Emirates markets rose, buoyed in part by high oil prices.

Twenty-five of the 30 stocks in Egypt's blue-chip index fell, as Egypt underperformed MSCI's emerging markets index, which was almost flat.

Middle East fund managers have turned negative towards Egyptian equities because of concern that the currency could weaken as global interest rates rise and foreign investors cut holdings of Egyptian Treasury bills, a Reuters poll showed on Sunday.

Thirty-one percent of managers now expect to cut allocations to Egyptian equities and only 8 percent to raise them in the next three months, the most negative balance for Egypt since February 2017.

The Saudi Arabian index rose 0.5 percent, lifted by banks and petrochemical stocks. National Commercial Bank jumped 2.6 percent and Sahara Petrochemical added 1.3 percent.

Alinma Investment Co, a unit of Alinma Bank, signed an agreement with Saudi Real Estate Co to establish a real estate fund that will develop three sites in Riyadh with a value of 1.5 billion riyals ($409 million). Saudi Real Estate rose 0.9 percent and Alinma Bank was up 1.3 percent.

The Dubai index gained 0.5 percent on the back of a 2.4 percent rise by Emaar Properties, which in the past couple of weeks has been recovering from 30-month lows.

Construction firm Drake & Scull rose 2.6 percent; the loss-making company postponed last Thursday's shareholder meeting to discuss its future to Oct. 4, citing the lack of a quorum.

Abu Dhabi's index closed 0.9 percent higher as First Abu Dhabi Bank rose 2.1 percent. Invest Bank added 6.4 percent in light trade; sources told Reuters last week that the Sharjah government was considering a possible merger of Bank of Sharjah, Invest Bank and United Arab Bank .

In Qatar, the index edged 0.2 percent lower, weighed down by banks. Commercial Bank fell 1.5 percent and Qatar Islamic Bank dropped 1.0 percent.

The Bahrain index fell 0.3 percent, with Khaleeji Commercial Bank plunging 8.9 percent after it announced the resignation of its chief financial officer.

SAUDI ARABIA * The index gained 0.5 percent to 8,038 points. DUBAI * The index closed up 0.5 percent to 2,850 points. ABU DHABI * The index rose 0.9 percent to 4,980 points. QATAR * The index fell 0.2 percent to 9,790 points. KUWAIT * The index dropped 0.3 percent to 5,329 points. BAHRAIN * The index closed down 0.3 percent to 1,335 points. OMAN * The index dipped 0.1 percent to 4,538 points. EGYPT * The index fell 1.2 percent to 14,447 points. (Reporting by Abinaya Vijayaraghavan in Bengaluru; editing by Andrew Torchia, Larry King)

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