Amman - Arab stock markets rallied for the second day in a row Tuesday, buoyed by rebounds in global markets following the rescue plan adopted by major European countries.

Analysts attributed the jump to a "tangible improvement in investors' confidence" and steps taken by regional central banks and other financial authorities to cut interest rates and pump liquidity into commercial banks.

"We believe that the rise in oil prices is also shoring up confidence in regional markets," an Amman-based portfolio manager said.

The Saudi stock exchange, the Arab world's largest bourse, gained 17 per cent in two days, led by the Saudi Basic Industries Corp. (SABIC) and other blue chip firms.

Jordanian shares also extended gains on Tuesday with the all-share price index of the Amman Stock Exchange (ASE) climbing by 4.7 per cent. This raises the gains in two days to more than 7 per cent.

The benchmark of the United Arab Emirates stock exchange of Dubai jumped more than 10 per cent on Tuesday, its highest rise in one day.

The rally coincided with the UAE government's decision to pump further 19 billion dollars to local banks to help them cope with any liquidity shortages. Earlier, the UAE government decided to guarantee deposits at commercial banks.

Kuwait's stock market was the only exception in the oil-rich Gulf region, as its all-share price index shed 0.3 per cent on Tuesday after a strong rebound on Monday. (dpa)