Saudi Arabia's stock market edged down in early trade on Thursday after Yemen government called for military intervention on the ground, a move that could further escalate the conflict in which Riyadh plays a leading role.

Yemen has urged the international community “to quickly intervene by land forces to save’’ the country, specifically in the cities of Aden and Taiz, according to a letter sent to the United Nations Security Council on Wednesday.

Saudi Arabia’s index fell 0.6 per cent as most stocks declined, including blue chips Saudi Telecom and Saudi Basic Industries, down 1.6 and 0.8 per cent, respectively.

Riyadh leads the coalition of Arab states that has since March carried out air strikes against Yemen’s Houthi rebels. Stock markets reacted negatively to the initial news of military intervention and its further escalation could dampen investor sentiment again, to a moderate degree.

Meanwhile, Egypt’s market edged up 0.6 per cent. Commercial International Bank (CIB), the country’s largest listed lender, was the main support, rising 0.9 per cent.

CIB has yet to publish its quarterly earnings, but another Egyptian bank, Credit Agricole Egypt, posted a 60 per cent jump in first-quarter profit on Wednesday to 236 million Egyptian pounds ($31 million), beating the estimate of NBK Capital, which had forecast 171 million pounds. The stock rose 1.5 per cent.

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