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Aug 3 (Reuters) - Egyptian shares slumped to a near 13-week low as the trial of former President Hosni Mubarak added to the country's political uncertainties on Wednesday, while Abu Dhabi Commercial Bank lifted the emirate's index after it swung to profit.

Most Gulf markets ended lower, while trade was muted in Cairo as most traders remained transfixed to television screens, following trial updates.

Mubarak is the first Arab ruler to appear in court since uprisings swept the region, and analysts say it is still unclear if the trial will lead to reconciliation or drag.

"For those of us in markets, uncertainty is always an excuse to sell, whether it's justifiable or not," said Akram Annous, MENA strategist at Al Mal Capital in Dubai.

"Markets want a smooth trial and an uncontroversial outcome, but until then they are likely to be on edge as this drama unfolds," he added.

The benchmark index slid 0.9 percent to its lowest level since May 8. The index has fallen 6.5 percent since July 17, mainly on concerns over political uncertainty.

Mobinil dropped 2.1 percent. One of the lawyers at Mubarak's trial called for a legal representative from Egypt's three main telecoms firms to come to court to talk about the communications cut during the uprising that overthrew Mubarak.

Egypt's shares were also under pressure after world stocks fell towards five-month lows on Wednesday as worries grew that fiscal cutbacks and stagnating output would prolong a global economic slowdown and aggravate Europe's debt crisis.

In the UAE, Abu Dhabi Commercial Bank (ADCB) helped lift the emirate's index , which rose by 0.2 percent on its third day of gains.

ADCB climbed 0.3 percent, taking its gains this year to 49 percent. The lender booked a $357 million profit from the sale of a stake in Malaysia's RHB Capital and reported quarterly earnings $364.9 million).

Most Gulf markets fell on the global concerns.

"Volumes are low but the main reason for the pressure in the market is the perception that the economic growth globally will suffer," said Youssef Kassantini, a Saudi-based analyst.

Saudi Arabia's benchmark shed 0.3 percent, stretching its 2011 losses to 3 percent.

The index is likely to continue in the downtrend for the next two week but stay relatively range-bound, Kassantini added.

Shares fell across the board, with telecom firm Zain Saudi leading decliners by turnover, slipping 0.8 percent.

Bellwether Saudi Basic Industries Corp (SABIC) lost 0.2 percent, a the sector's index fell 0.5 percent.

Dubai's index down 0.6 percent, as telecom operator du shed 0.3 percent despite posting an estimate-beating quarterly net profit.

"We need to see foreign buying coming through, which is fragile right now," said Sachin Mohindra, senior vice-president at Invest AD.

"High net worth individuals are very sensitive to the international developments."

Oman's index slipped 0.9 percent and Qatar dropped 0.4 percent.

TUESDAY'S HIGHLIGHTS

EGYPT

* The measure fell 0.8 percent to 4,923 points.

ABU DHABI

* The index rose 0.2 percent to 2,650 points.

SAUDI ARABIA

* The index slipped 0.3 percent to 6,424 points.

DUBAI

* The index declined 0.6 percent to 1,527 points.

OMAN

* The index slipped 0.9 percent to 5,758 points.

QATAR

* The benchmark fell 0.4 percent to 8,398 points.

KUWAIT

* The measure eased 0.1 percent to 6,068 points.

BAHRAIN

* The measure eased 0.02 percent to 1,284 points. (Editing by Firouz Sedarat)

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Police in a wealthy suburb of Sydney are trying to defuse a bomb that the media says has been attached to the neck of an 18-year-old girl in an apparent extortion attempt.

Update at 9:44 a.m. ET: 9 News dsescribes the home in the Mosman suburb as "palatial."

Update at 9:40 a.m. ET: Four specialists, including police negotiators and bomb disposal experts, are inside the house helping to keep the woman calm as they examined the device, assistant police commissioner Mark Murdoch says, according to the Associated Press. "It is proving a tough nut to crack for us to determine exactly what it is and what it is not."

Update at 9:33 a.m. ET: The Telegraph, a Sydney paper, quotes an unidentified senior police police officer as describing the device as a "collar bomb."

Update at 9:29 a.m. ET: Ten News reports that a ransom note that threatened to blow up the house apparently was attached to the device.

Update at 9:22 a.m. ET: Sydney Police have cordoned off the house and closed several nearby streets, The Sydney Morning Herald reports.

Police in Sydney, Australia, are trying to defuse an explosive device reportedly strapped to the neck of a 18-year-old girl at home in a wealthy suburb of Sydney, Australia, the Herald Sun reports.

Police will confirm only that the device is "near" the teen.

New South Wales Assistant Police Commissioner Mark Murdoch says the circumstances surrounding the incident are unclear and has not confirmed whether it involves an extortion attempt.

"We don't know what we are dealing with ... we are working very hard to find out exactly what it is, and equally important, what it isn't," Murdoch tells the paper.

He says the girl is believed to be a 12-grade student at a private school. He describes her as "extremely calm" as special officers try to remove the device.

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WASHINGTON—The US debt mountain undermined financial markets Wednesday despite President Barack Obama signing a major austerity bill that raises the borrowing ceiling and averts default.
Credit rating agencies said they were still keeping a watchful eye on the ability of the United States to cope with its debt.
Global stocks fell under the twin pressures of lingering concern about the long-term health of the US economy, and a sharp resurgence of the debt crisis in the eurozone despite a package of emergency measures two weeks ago.
Obama cautioned Tuesday that the contentious US plan was “just the first step” on a long road to economic recovery,
But in a sign that the economic headaches were far from over for Washington, Chinese rating agency Dagong said Wednesday it had downgraded the US credit rating after the debt ceiling for the world’s biggest economy was raised.
In a castigating review of US efforts, China’s official Xinhua news agency on Wednesday also warned the 11th hour deal had “failed to defuse Washington’s debt bomb for good,” while it mocked the drawn-out negotiations between Republicans and Democrats as a “madcap farce of brinkmanship.”
The measure sent to Obama by deeply polarized lawmakers lifts cash-strapped Washington’s $14.3 trillion debt limit by up to $2.4 trillion while cutting at least $2.1 trillion in government spending over 10 years, a step forecast to drag down already sluggish US growth.
“It’s an important first step to ensuring that, as a nation, we live within our means,” Obama said in the White House Rose Garden. “This is, however, just the first step.”
Obama spoke after the US Senate voted 74-26 to pass the measure – which cleared the House of Representatives by an overwhelming 269-161 margin on Monday – with just hours to spare before a midnight (0400 Wednesday) deadline that could have triggered a first-ever US default on its debt payments.
“Slowing down the big-government freight train from its current trajectory will give us the time we need to work toward a real solution,” said Republican Senate Minority Leader Mitch McConnell.
Congressional approval paid immediate dividends as the IMF applauded the deal and the Fitch and Moody’s ratings agencies said the last-minute compromise would spare Washington from losing its sterling triple-A debt rating.
A downgrade would have likely led to a spike in US interest rates, hitting consumer and business spending. It would have severaly damaged credibility in the US economy and sent shock waves around global financial markets.
Moody’s, which had warned of a possible downgrade in July due to concern that the government could be forced to default, added a “negative outlook” on the grade, saying a historic downgrade could still come if fiscal discipline weakens or economic growth deteriorates significantly.
And Fitch said it would keep a close eye on the country’s long-term finances and pressed for “a credible multi-year deficit reduction plan” if Washington is to stay in the elite club of healthy, low-risk debtor economies.
The International Monetary Fund’s Managing Director Christine Lagarde applauded the debt deal as “good for both the US and global economy” but pushed US leaders to craft a plan to put public finances “on a sustainable path.”
Obama’s 2012 re-election bid will turn on voters’ perception of his handling of the US economy, which has labored under historically high unemployment above nine percent as it struggles to recover from the global meltdown of 2008.
Republicans have promised the spending cuts will create jobs, but top Wall Street economists have warned the austerity measures will actually be a drag on sluggish US growth even as government stimulus measures run out.
The overall shift from priming the US economy to government belt-tightening is expected to reduce US growth next year by about 1.5 percentage points, according to JPMorgan Chase economists.
The vote came as the US Commerce Department reported that US consumer spending, the economy’s key driver, fell 0.2 percent in June relative to May, while personal income was basically stagnant, with just a 0.1 percent increase.
US stocks had also Tuesday plunged more than two percent, focusing on dismal economic numbers and the prospect of no more government spending to boost the economy.
The new law calls for more than $900 billion in cuts over the next 10 years – $350 billion of it in defense – and creates a special congressional committee tasked with coming up with another $1.5 trillion in cuts to report by November 23, with Congress voting by December 23.

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