* Fund managers consider Qatar shares fairly valued

* Saudi petchems lead market lower

* All Saudi retailers down on consumer spending worries

* Telecom Egypt cools a day after obtaining 4G licence

* Dubai firm as single-stock futures launched in UAE

By Celine Aswad

DUBAI, Sept 1 (Reuters) - Qatar's main stock index fell sharply for a second straight day on Thursday after FTSE published a list of stocks to be included in its secondary emerging market index, while Saudi Arabian petrochemical stocks sagged because of weak oil prices.

Doha's index .QSI initially rose but closed down 1.4 percent, taking its losses for the week to 3.0 percent.

Although Qatar's upgrade to emerging market status is widely seen as positive for the market, investors had bought up stocks in anticipation of the list's publication in recent weeks, leaving many shares at or above analysts' estimates of fair value.

A monthly Reuters poll of Middle East fund managers, published on Wednesday, found them turning negative on Qatar for the next three months because of valuations. ID:nL8N1BB1LA

Only one of the 22 stocks due to join the FTSE index on Sept. 20 rose on Thursday; United Development Co UDCD.QA , which had underperformed other eligible shares, climbed 2.1 percent. Among other FTSE constituents, Qatar National Bank QNBK.QA lost 1.2 percent and telecommunications operator Ooredoo ORDS.QA declined 1.9 percent.

Petrochemical shares in Saudi Arabia declined after Brent oil futures LCOc1 fell back below $47.00 a barrel. The main Saudi index .TASI dropped 1.0 percent in the highest volume in 11 days, with Yanbu National Petrochemicals 2290.SE (Yansab) losing 1.2 percent. Consumer discretionaries, which have been sluggish over the last several weeks because of Saudi Arabia's economic slump, continued to drop with retailer Fawaz Alhokair 4240.SE declining 1.0 percent and discount supermarket operator Al Othaim Market 4001.SE retreating 3.6 percent.

Cairo's main index .EGX30 edged down 0.3 percent as 70 percent of traded shares retreated, trimming some of Wednesday's 1.0 percent gain.

Telecom Egypt ETEL.CA , which rose 2.7 percent on Wednesday after saying it had acquired the country's first 4G mobile licence, shed 1.0 percent to 10.00 Egyptian pounds.

In an interview with al-Arabiya television, the company's chief executive Tamer Gadallah said a large portion of the 7.8 billion pound ($878 million) cost of the licence had already been paid and the firm also planned to offer 2G and 3G services via other carriers' networks. He also said there was no plan to sell the company's stake in Vodafone Egypt VODE.CA .

Analysts at Naeem Brokerage said the terms of the 4G agreement came as no surprise.

"However, for the time being, dividend pay-out sustainability is our main worry, as licence payments coupled with mobile services-related expenditures could drain TE's cash position," said Naeem, which cut its recommendation for the stock to "hold" but maintained a price target of 11.00 pounds.



UPBEAT UAE

The Reuters poll found fund managers bullish on the United Arab Emirates by a large margin. Dubai's main index .DFMGI climbed 0.2 percent in the highest volume in two weeks, with most turnover coming from small and mid-sized shares.

Shuaa Capital SHUA.DU , which was providing market-making services for the launch of single-stock futures on major UAE companies on Thursday, rose 3.4 percent. Dubai Parks and Resorts DUBA.DU added 1.8 percent.

"Markets in the UAE were slightly up today because of higher volumes as some investors are taking positions in anticipation of the U.S. jobs data report due on Friday, which will help give some clearer guidance on the prospects of an interest rate hike," said Mohammed Shabbir, independent investment advisor for Dubai-based Value IQ.

In Abu Dhabi, the index .ADI nudged up 0.2 percent, buoyed by gains in blue chips such as First Gulf Bank FGB.AD , up 1.3 percent, and Aldar Properties ALDR.AD , up 0.7 percent.



THURSDAY'S HIGHLIGHTS



SAUDI ARABIA

* The index .TASI fell 1.0 percent to 6,022 points.

DUBAI

* The index .DFMGI edged up 0.2 percent to 3,512 points.



ABU DHABI

* The index .ADI rose 0.2 percent to 4,481 points.



EGYPT

* The index .EGX30 fell 0.3 percent to 8,136 points.



QATAR

* The index .QSI retreated 1.4 percent to 10,837 points.



KUWAIT

* The index .KWSE slipped 0.2 percent to 5,409 points.



OMAN

* The index .MSI fell 0.4 percent to 5,714 points.



BAHRAIN

* The index .BAX added 0.1 percent to 1,143 points.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Emerging markets stocks http://reut.rs/1J7Qj6V Frontier stocks http://link.reuters.com/zyh97s Gulf stocks, emerging index http://link.reuters.com/cun29t

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Editing by Andrew Torchia) ((celine.aswad@thomsonreuters.com; +971 4 4536886; Reuters Messaging: celine.aswad.thomsonreuters.com@reuters.net))