MIDEAST STOCKS-Gulf markets mixed; Saudi stocks hardest hit on Aramco attack

By Ateeq Shariff

Oct 14 (Reuters) - Gulf stock markets closed mixed on Wednesday, with Saudi shares leading losses after an attack on Saudi Aramco headquarters deepened fears of an escalating conflict between the kingdom and Yemen's Houthis.

Houthis vowed on Wednesday to continue targeting Saudi airports and oil facilities, a day after a strike that sources said heavily damaged the headquarters of oil giant Saudi Aramco 2223.SE.

Saudi Arabia's benchmark index .TASI fell 1.7%, weighed down by 2% declines in both Saudi National Bank 1180.SE, the country's largest lender by assets, and Al Rajhi Bank 1120.SE.

Aramco 2222.SE shares down 1.6%.

The kingdom's Energy Ministry said an administrative building belonging to the state oil company in the eastern city of Dhahran was hit, causing a limited fire, as fighting between the kingdom and the Iran-allied group intensified.

Over the past week, the Houthis have fired a barrage of ballistic missiles and drones at Saudi Arabia in retaliation for Riyadh's support of Yemeni government forces. The capital's international airport has been hit four times, including a strike on Saturday that killed 13 people.

In the latest incident, debris from two intercepted missiles fell on Riyadh, injuring four people and causing limited damage to 15 homes. The state news agency SPA reported this on Wednesday, citing the Civil Defense spokesperson.

Elsewhere, Qatar's index .QSI fell 0.7%, weighed down by a 2% drop in petrochemical maker Industries Qatar IQCD.QA.

Geopolitical developments in the region remained in focus. Continued disruptions in the Strait of Hormuz kept investors cautious, while hopes for progress in talks lent some stability to markets. The spotlight is now on firm de-escalation timelines to further ease tensions, said Mahmoud Mashal, Senior Market Analyst, VT Markets Dubai.

Regional tensions rose further as two senior Iranian officials told Reuters that Tehran is using new tactics to target ships sailing through the Strait of Hormuz. They said the aim is to keep oil prices high and influence the US midterm elections.

The UAE went the other way. Dubai's main share index .DFMGI rose 0.6%, helped by a 2.8% gain in top lender Emirates NBD ENBD.DU, while the Abu Dhabi index .FTFADGI was up 0.4%.

Outside the Gulf, Egypt's blue-chip index .EGX30 gained 0.4%, snapping a six-session losing streak.