Investor confidence in Gulf Arab economies, gauged by Dubai-based investment bank Shuaa Capital, fell 7.8 percent in July from the previous month.

The monthly GCC Investor Confidence Index fell to 123 points in July, down 10.5 points from June, Shuaa said in a report on Monday.

But investor outlook for the six members of the Gulf Cooperation Council (GCC) is positive as investors expect all GCC economies to improve by the end of 2009, it said.

The monthly survey of 1500 regional and institutional investors launched in April focuses on economic conditions, stock prices, sectors and commodities.

'It has proven to be a very challenging month for the GCC economies, with investors' perception of current economic conditions sliding dramatically into the negative,' said Oliver Schutzmann, chief communications officer at Shuaa Capital.

Confidence in the United Arab Emirates was the lowest this month with the UAE Investor Confidence Index dropping to 113.9 points from 123.8 points in June.Qatar and Saudi Arabia gauges were the highest and that of Kuwait was the lowest.-Reuters