* Hopes that troubled Saudi telcos have turned corner
* Saudi Investment Bank drops on Oger's 2.8 pct stake sale
* Eshraq buoyed by joint venture plan with Mubadala
* Arabtec shares pull away from 6-year low on new group CFO
* Qatar's market is worst performer
By Celine Aswad
DUBAI, April 17 (Reuters) - Two Saudi Arabian telecommunications stocks surged on Monday on hopes that troubled operators have finally turned the corner, while Abu Dhabi real estate firm Eshraq was helped by a plan to tie up with state fund Mubadala.
The Saudi stock index edged up 0.1 percent as Zain Saudi jumped 8.9 percent and Etihad Etisalat (Mobily) added 3.6 percent. Last week Zain reported its first-ever quarterly net profit, and this raised hopes for Mobily, which has also been struggling to make money.
"I believe the market is expecting Mobily to report profits just like Zain did," said Iyad Ghulam, senior equity analyst at NCB Capital.
"But I don't expect the company to be able to report strong growth in sales as Zain did, and costs may remain relatively high," Ghulam added. NCB Capital has forecast Mobily will post a small loss of 50 million riyals ($13.3 million) for the three months to March 31.
Saudi banks started strongly but then came well off their highs. Mid-sized Bank Aljazira, which jumped as much as 2.6 percent early in the day after its first-quarter earnings beat expectations, closed 0.9 percent lower.
Aljazira made a net profit of 216 million riyals; NCB Capital had expected 184 million riyals and EFG Hermes, 165 million riyals. Profit plunged 43.3 percent from a year earlier, but the bank said this was because of a 209 million riyal special gain from a land sale in the year-earlier period.
Shares in bigger banks Al Rajhi and Riyad Bank traded higher early in the day but closed flat. Al Rajhi, which reported quarterly earnings in line with forecasts, had dropped 2.3 percent on Sunday on news that it was among Saudi companies being sued by U.S. insurers over the Sept. 11, 2001 attacks.
Riyad Bank's first quarter net profit fell 10.8 percent to 1.05 billion riyals but was ahead of the average analyst forecast of 876.5 million riyals.
Saudi Investment Bank, the worst performing lender, lost 1.8 percent. Before the start of trade, exchange data showed financially troubled construction company Saudi Oger had sold a 2.8 percent stake in the bank, bringing its stake down to 5.8 percent. The buyers of the stake were not revealed.
In Abu Dhabi, Eshraq Properties, whose shares came under pressure last week on news that the emirate's property prices were softening, rebounded 1.8 percent after Abu Dhabi government fund Mubadala said it was considering forming a venture with the loss-making real estate developer.
This would involve developing land in Abu Dhabi owned by Mubadala on Al Maryah Island, where a new financial free zone is located, and by Eshraq on Al Reem Island.
First Abu Dhabi Bank, the United Arab Emirates' largest lender, added 2.8 percent; the stock is up 7.8 percent since the bank was formed in a merger on April 1. The Abu Dhabi index was the region's best performer on Monday, adding 1.2 percent.
In Dubai, loss-making builder Arabtec rose 3.2 percent, pulling away from a six-year low after Arabtec hired a new chief financial officer, Peter Pollard, who will oversee its recapitalisation programme. At a shareholder meeting on Tuesday, Arabtec will seek investor approval for a 1.5 billion dirham ($408 million) rights issue.
Arabtec's rebound helped the Dubai stock index close 0.3 percent higher.
In Doha, real estate firms and banks were the main drags on the index, which fell 0.9 percent. Ezdan Holding Group was the worst performer, dropping 3.4 percent, while the largest bank, Qatar National Bank, fell 2.1 percent.
Egypt's bourse was closed for a public holiday.
* The index edged up 0.1 percent to 7,012 points.
* The index rose 0.3 percent to 3,464 points.
* The index climbed 1.2 percent to 4,545 points.
* The index fell 0.9 percent to 10,336 points.
* The index fell 0.7 percent to 6,920 points.
* The index edged down 0.1 percent to 5,544 points.
* The index added 0.1 percent to 1,346 points.
Editing by Andrew Torchia