Wires

MIDEAST STOCKS-Kuwait leads Gulf losses as U.S.-Iran tensions escalate, Aramco lowest since IPO

Ateeq Shariff

Aramco lowest since IPO@

* Saudi Arabian banks slide

* Aramco closes at 34.6 riyals

* Egypt hits its lowest in 3 months

* Kuwait sees biggest fall in over 2 years

Jan 5 (Reuters) - Gulf bourses saw steep declines on Sunday, with Kuwait falling the most following tensions between the United States and Iran, while outside the Gulf Egypt was also hard hit as all its shares ended lower. Iranian military commander Qassem Soleimani was killed on Friday in a U.S. drone strike on his convoy at Baghdad airport, seen by Tehran as an act of war that risks regional conflagration. "Not surprising, the Gulf markets are reacting negatively given we are in the middle of all the geopolitics action," said Vrajesh Bhandari, senior portfolio manager at Al Mal Capital. "We fear this can be an overhang over the next few months and not just a one day or week thing." Saudi Arabia's benchmark index lost 2.4%, weighed down by a 2.1% drop in Al Rajhi Bank and a 1.7% fall in state-owned Aramco to 34.6 riyals, which hit its lowest intraday level since last month's market debut. Egypt's blue-chip index dived 4.4%, touching its lowest since September 2019. The country's largest lender Commercial International Bank closed down 1.9% and Eastern Company dived 4.9%. In Kuwait, the index plunged 4.1% with all stocks in the red including Kuwait Finance House, down 5.1%, and National Bank of Kuwait, off 2.8%. The Dubai index tumbled 3.1%, hurt by a 3.1% slide in its largest lender Emirates NBD and a 3.7% decline in Emaar Properties. Abu Dhabi's index lost 1.4%, with the United Arab Emirates' largest lender First Abu Dhabi Bank retreating 1.2%, while Abu Dhabi Commercial Bank was down 3.3%. The Qatar index eased 2.1% with all its 20 stocks closing lower. Lender Masraf Al Rayan fell 2.7% and Qatar National Bank declined 1.4%.

SAUDI ARABIA down 2.4% to 8,194 pointsABU DHABI dropped 1.4% to 5,028 pointsDUBAI declined 3.1% to 2,684 pointsQATAR fell 2.1% to 10,286 pointsEGYPT down 4.4% to 13,284 pointsBAHRAIN lost 2.3% to 1,576 pointsOMAN down 0.3% to 3,993 pointsKUWAIT plunged 4.1% to 6,692 points

($1 = 3.7507 riyals)

(Reporting by Ateeq Shariff in Bengaluru Editing by David Holmes)