DUBAI - Gulf stock markets were generally sluggish in early trade on Thursday although Saudi Arabia edged up and Dubai was boosted by strength in construction stocks.

The Dubai index added 0.6 percent as Drake & Scull, the most heavily traded stock, surged 4.1 percent to 2.29 dirhams, which would be its highest close since April 2016.

The construction company posted a big third-quarter loss but investors are hoping for much better fourth-quarter results now that a recapitalisation has been completed, which may help it obtain operating funds.

Some analysts believe the stock, which has jumped from around 1.70 dirhams in mid-November, is overvalued, however; earlier this month, Deutsche Bank cut it to "sell" from "hold" with a 1.13 dirham target price.

Builder Arabtec, which has been trading near multi-year lows, surged 2.5 percent after saying a unit had won a 1.025 billion dirham ($279 million) contract from Dubai Properties, part of the investment vehicle of Dubai's ruler, for work on a residential community.

The Saudi index rose 0.3 percent in the first 55 minutes as petrochemical firms stayed strong following this week's surge in oil prices.

Sahara Petrochemical jumped 3.9 percent after proposing a dividend of 1 riyal per share for 2017, up from 0.75 riyal for 2016.

Al Samaani Factory Metal Industries soared 8.6 percent after proposing a capital increase through a bonus share issue, and an annual dividend of 1.5 riyal per share.

Qatar's index edged down 0.2 percent as Vodafone Qatar, which had shot up by more than a third between mid-November and the start of this week, continued to pull back, dropping 2.5 percent.

(Reporting by Andrew Torchia; Editing by Kevin Liffey) ((andrew.torchia@thomsonreuters.com)(+9715 6681 7277)(Reuters Messaging: andrew.torchia.thomsonreuters.com@reuters.net))