"Compounding this is the upcoming week-long Eid holiday which retail and institutional investors are looking to de-risk ahead of."
Investors are keen to book profits given the strong performance of some equity markets in the region, he added.
Qatar's main index witnessed the sharpest decline among its regional peers.
Qatari stocks are up more than 10 percent so far this year, bolstered in recent months by its move to increase its foreign ownership ceiling to 49 percent from 25 percent to boost its weighting on global indexes.
The index was down 1.5 percent on Thursday, with Qatar Islamic Bank QISB.QA witnessing the biggest decline at 4.6 percent.
In Saudi Arabia, commodity and banking stocks led the declines on the Tadawul index, which was flat.
Saudi Basic Industries Corp (SABIC), the world's no. 4 chemical maker, was down 0.7 percent. Saudi Arabian Mining Company (Ma'aden) declined 2.5 percent.
Samba Financial Group and Banque Saudi Fransi declined 0.7 percent and 0.2 percent respectively.
There has been no significant impact from the depreciation of the Turkish lira on the results and quality of Saudi Arabian bank assets, Talaat Hafez, spokesman for Saudi banks, was quoted as saying in a tweet carried by the kingdom's state TV Alekhbariya on Thursday.
Earlier on Thursday National Commercial Bank, Saudi Arabia's largest bank by assets, said there was limited impact from the decline of the lira on the bank.
The currency has lost nearly 40 percent against the dollar this year, driven by worries over Turkish President Tayyip Erdogan's growing influence on the economy and his repeated calls for lower interest rates despite high inflation.
Dubai's index was slightly down, with blue-chip stocks mixed in trading. Dubai Islamic Bank, the emirate's oldest Shariah compliant lender, declined 1.2 percent.
Emirates NBD, Dubai's biggest lender, was down one percent amid continued concerns among investors about its deal in May to buy Turkey’s Denizbank DENIZ.IS for $3.2 billion.
Elsewhere in the region, Abu Dhabi's benchmark rose 0.4 percent. Abu Dhabi National Energy Company, also known as Taqa, gained 6.2 percent.
* The index was flat percent at 7,867 points.
* The index fell 0.5 percent to 2,803 points.
* The index rose 0.4 percent to 4,907 points.
* The index lost 1.5 percent to 9,448 points.
* The index rose 0.2 percent to 5,382 points.
* The index rose 0.3 percent to 1,347 points.
* The index was flat at 4,390 points.
* The index slipped 0.3 percent to 15,310 points.
(Reporting by Hadeel Al Sayegh; Editing by Catherine Evans) ((Hadeel.firstname.lastname@example.org; +9715 6681 7277; Reuters Messaging: email@example.com))