Most stock markets in the Gulf sank on Monday as battles between Palestinian group Hamas and Israel ignited fears of a wider conflict in the Middle East.

Israel said its troops backed by helicopters had also killed a number of armed infiltrators entering the country from Lebanon, further raising concerns fighting could spread two days after Hamas gunmen burst in from Gaza on a deadly rampage.

Dubai’s benchmark index slumped 2.6%, the sharpest fall since June last year. The index was dragged down by losses in all sectors with real estate developers Emaar Properties and Emaar Development dropping 4.4% and 5% respectively.

The emirate’s largest lender Emirates NBD sank 1.9% and Dubai Islamic Bank dropped 3.3%.

In Abu Dhabi, the benchmark index retreated for a fourth consecutive session and ended 1.3% lower, the lowest since May as almost all the stocks on the index were in negative territory.

State-owned oil major ADNOC’s units Abu Dhabi National Oil Company for Distribution and ADNOC Logistics lost 3.8% and 1.9% respectively.

Among the losers, the UAE’s largest lender First Abu Dhabi Bank slipped 1.2% and Abu Dhabi Islamic Bank shed 2%, while blue-chip developer Aldar Properties slumped 2.9%.

The Qatari index fell for a fourth straight session, ending 1.7% lower, with all stocks in the red.

The region’s largest lender Qatar National Bank dropped 2.6% and Qatar Islamic Bank slid 1.7%.

Saudi Arabia’s benchmark index recovered some of previous session losses, ending 0.2% lower after it slumped 1.6% in last session, the sharpest decline in 10 months.

The kingdom’s largest lender Saudi National Bank dropped 2.2% and Saudi Basic Industries shed 1.8%.

However, Etihad Atheeb Telecommunication rose 1.5% and the world’s largest Islamic bank by assets, Al Rajhi Bank gained 1.2%.

Outside the Gulf, Egypt’s blue-chip index recouped some of previous session losses and rose 0.3%.

The index was helped by gains in finance and communications sectors with Commercial International Bank rising 1.7% and Telecom Egypt adding 2.2%.

========================================== SAUDI ARABIA      fell 0.2% to 10,575 KUWAIT            lost 1.6% to 7,236 QATAR             dropped 1.7% to 98,36 EGYPT             added 0.3% to 19,410 BAHRAIN           lost 0.4 to 1,941 OMAN              added 0.2% to 4,752 ABU DHABI         dropped 1.3% to 9,631 DUBAI             declined 2.6% to 4,056==========================================