MIDEAST STOCKS-Saudi shares fall after second airport attack as Gulf trade stays cautious

By Ateeq Shariff

Oct 12 (Reuters) - Saudi stocks retreated on Monday after a fresh attack weighed on sentiment, while several Gulf markets also ended lower as investors held back from big bets amid uncertainty over the US-Iran conflict.

Saudi Arabia said on Monday it was facing a fresh barrage of incoming fire, with Riyadh airport to remain closed for now, days after Yemen's Iran-allied Houthis claimed a deadly missile strike on a departure terminal on Saturday.

Saudi Arabia's benchmark index .TASI dropped 0.7%, with Saudi National Bank 1180.SE - the country's biggest lender by assets - losing 1.2%.

However, oil major Saudi Aramco 2222.SE gained 0.2%.

Brent crude reversed earlier losses to rise $1.24, or 1.2%, to $106.19 a barrel by 1124 GMT, as attacks on Saudi Arabia outweighed hopes of extra supply after US President Donald Trump hailed fresh Russian diesel exports and a Russia-Ukraine energy ceasefire. O/R

Airlines are cancelling flights to Saudi Arabia and neighbouring countries after Yemen's Iran-aligned Houthis attacked Riyadh airport over the weekend, deepening regional disruption caused by the Iran conflict.

There was little sign of a diplomatic breakthrough in the US-Iran standoff over the Strait of Hormuz.

State media on Sunday quoted Iran's security chief, Mohsen Rezaei, as saying the US had given an "insufficient" response to Tehran's seven conditions for reopening the vital waterway.

The attacks also affected a major oil industry event in the kingdom, with a company spokesperson saying on Sunday BP's BP.L CEO would not attend the World Petroleum Council Energy Congress in Riyadh.

The Saudi energy ministry said the five-day conference went ahead as scheduled at a convention centre around 10 km (6.2 miles) from the targeted airport.

Dubai's main share index .DFMGI added 0.3%, while the Abu Dhabi index .FTFADGI dropped 0.3%.

In Qatar, the index .QSI advanced 1.2%, recouping part of the 1.5% loss from the previous session.

Outside the Gulf, Egypt's blue-chip index .EGX30 retreated 1.1%.

Egypt's current account deficit widened to $22.5 billion in fiscal year 2025/26 from $15.4 billion a year earlier, the central bank said on Monday.