DUBAI - Shares of Abu Dhabi-listed Dana Gas DANA.AD fell sharply on Sunday after news that a London court hearing on its maturing sukuk issue would resume, while Qatar's bourse bucked a general downtrend in the region.

After several delays last week, a London High Court trial on the validity of $700 million of sukuk issued by Dana will go ahead on Monday. Dana said in June it would not repay holders of its Islamic bond, or sukuk, because it had become invalid under United Arab Emirates law.

The case is being fought in UAE and British courts, and sukuk holders have been hoping the London court will produce a ruling that effectively shuts down Dana's legal campaign in both jurisdictions. The uncertainty knocked Dana's shares 5.1 percent lower on Sunday.

"When creditors and shareholders are at odds in a legal hearing, this sends a bad signal," said a regional fund manager.

Escalating tensions between North Korea and the United States weighed on Gulf markets in general, dragging the Abu Dhabi index .ADI 0.3 percent lower.

The Dubai index .DFMGI fell 0.9 percent as 27 shares declined including Emaar Properties EMAR.DU , which lost 1.6 percent. Only seven stocks rose.

Shares favoured by foreign funds weighed on Egypt's blue-chip index .EGX30 , which fell 0.6 percent; Global Telecom Holding GTHE.CA lost 2.0 percent. But the broader EGX100 index .EGX100 added 0.7 percent.

Qatar's index .QSI rose 0.4 percent as local and other regional investors were net buyers, bourse data showed, although the latter group accounted for only a very small fraction of Sunday's market turnover.

The Qatari index gained for a fourth straight day, suggesting it may have bottomed after a steep slide due to the decision of four Arab states in June to cut ties with Doha.

Most banking shares rose on Sunday; Islamic lender Masraf Al Rayan MARK.QA added 2.4 percent.

The Saudi Arabian .TASI and Omani .MSI were closed for public holidays on Sunday.

HIGHLIGHTS



DUBAI



* The index .DFMGI fell 0.9 percent to 3,600 points.



ABU DHABI



* The index .ADI declined 0.3 percent to 4,440 points.



QATAR

* The index .QSI rose 0.4 percent to 8,396 points.



EGYPT



* The index .EGX30 fell 0.6 percent to 13,607 points.



KUWAIT



* The index .KWSE dropped 0.8 percent to 6,795 points.

BAHRAIN



* The index .BAX edged down 0.3 percent to 1,304 points.

(Editing by Andrew Torchia/Keith Weir) ((celine.aswad@thomsonreuters.com)(+971 5 6224 7653)(Reuters Messaging: celine.aswad.thomsonreuters.com@reuters.net))