DUBAI - Qatar's stock index hit a five-year low on Monday because of a fresh sign that a diplomatic dispute in the region was starting to inflict long-term damage on some of its companies.

Shares of Qatar Insurance QINS.QA dropped 2.3 percent after the company said it was closing its Abu Dhabi branch because it had not been able to obtain a licence. The United Arab Emirates, Saudi Arabia, Bahrain and Egypt cut diplomatic and transport ties with Doha on June 5.

Its Abu Dhabi business, which had been operating since 2002, used to bring in annual gross premiums of 110 million Qatari riyals ($30 mln), the company said.

Qatar's main stock index .QSI fell 1.2 percent, dropping for an 11th straight session and bringing its losses since the diplomatic rift developed to 16.6 percent.

"The market is in free-fall at the moment and until there is clarity about how the crisis will be resolved, I don't see a floor," said a regional fund manager.

The Saudi index .TASI edged down 0.1 percent, hit by declines in most banking stocks as investors booked profits on recent gains. Bank Aljazira 1020.SE , which had risen 3.9 percent on Sunday, lost 0.9 percent.

Airport service operator Saudi Ground Services 4031.SE dropped 3.5 percent after saying it plans to distribute a dividend of 0.65 riyal per share for the second quarter, the same as in the year-ago period.

Dubai's index .DFMGI rose 0.8 percent as theme park operator DXB Entertainments DXBE.DU , the top performer of the day, jumped 6.2 percent; trading volume was moderate, though. Emaar Properties EMAR.DU added 2.2 percent.

The Egyptian index .EGX30 edged down 0.2 percent but Arabian Food Industries DOMT.CA (Domty) rose 1.6 percent after saying it expects its third-quarter revenue to reach 700 million Egyptian pounds ($39.7 million). Second-quarter revenues were 487 million pounds.



HIGHLIGHTS



SAUDI ARABIA



* The index .TASI edged down 0.1 percent to 7,393 points.



DUBAI



* The index .DFMGI added 0.8 percent to 3,660 points.



ABU DHABI



* The index .ADI rose 0.1 percent to 4,453 points.



QATAR

* The index .QSI lost 1.2 percent to 8,279 points.



EGYPT



* The index .EGX30 declined 0.2 percent to 13,593 points.



KUWAIT



* The index .KWSE fell 0.3 percent to 6,890 points.



BAHRAIN



* The index .BAX slipped 0.1 percent to 1,298 points.



OMAN



* The index .MSI lost 0.2 percent to 4,987 points.

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