* Foreign funds continue to exit Qatar

* UAE's Dana Gas slumps ahead of London court hearing

* Saudi index supported by petrochemicals gains

* Bank Aljazira rises after Fitch affirms credit rating

* Egypt's El Sewedy Electric shines on solar plant deal

By Celine Aswad

DUBAI, Sept 17 (Reuters) - Qatar's stock index fell for a tenth straight session on Sunday as talk of dispute negotiations fails to sway investors, while strong oil prices boosted the Saudi Arabia market.

On Friday Qatari Emir Sheikh Tamim bin Hamad al-Thani said his country was ready to sit at the negotiating table to try to end its diplomatic dispute with Gulf Arab neighbours. But in the absence of any positive response from the Saudi-led coalition that is boycotting Qatar, investors did not take the remarks as a sign that the dispute was moving closer to resolution.

"There is too much uncertainty around Qatar right now, and the full extent of how hard those companies have been hurt by this crisis is yet to be known," one Paris-based fund manager said.

Qatar's index fell 0.4 percent to 8,375 points, but closed 62 points above the session low. The index has lost 6.3 percent over 10 sessions.

Doha Bank dropped 2.6 percent. Last week sources told Reuters the bank had cut about 10 jobs in the United Arab Emirates and planned to put some staff on unpaid leave because of the hit to its business from the diplomatic dispute. The bank said the information was incorrect but declined to elaborate.

Foreign investors remained net sellers of Qatari stocks by a ratio of almost three to two, bourse data showed.

In Abu Dhabi, Dana Gas plunged by 6 percent and accounted for more than 70 percent of total market volume, dragging down the index by 0.8 percent.

Dana rose last week after its Islamic bond holders proposed a deal to end a dispute over its refusal to redeem $700 million of maturing sukuk. But Dana rejected the proposal and a London High Court hearing on the dispute is due to start this week.

The Dubai index fell 0.7 percent in thin trade. Union Properties, the most heavily traded stock, lost 1.1 percent.

In Saudi Arabia, the index rose 0.4 percent as all but three of the 14 listed petrochemical shares rose after Brent oil closed near a five-month peak above $55 a barrel on Friday. Saudi Kayan Petrochemical added 2 percent.

Banking shares were also generally strong, with Bank Aljazira climbing 3.9 percent after ratings agency Fitch affirmed the lender's BBB+ credit rating with a stable outlook.

Newly listed Zahrat Al Waha, which makes plastic bottle caps and other products, rose as much as 9.6 percent from its initial public offer price of 51.0 riyals on its first day of trade but closed 3.5 percent lower.