Saudi Arabia's index rose 0.7 percent with Banque Saudi Fransi rising 5.2 percent.
Riyad Bank continued to rise, adding 4.5 percent.
The lender had picked Goldman Sachs to advise on its merger talks with National Commercial Bank (NCB), Reuters reported, citing sources familiar with the matter. NCB shed 0.4 percent.
The Saudi market, which will become part of the MSCI emerging market benchmark this year, has started the year on a positive note, rising 7.6 percent so far this year.
Foreign selling, which accelerated in the second half of 2018, is also showing signs of easing.
Saudi exchange data released on Sunday showed foreigners were net buyers of 1.03 billion riyals ($274.60 million) of stocks last week, up from the 134.3 million riyals of stocks foreigners bought the week before.
Most cement stocks also gained with Tabuk Cement increasing 4.8 percent after saying that it had exported 6,950 tonnes of cement to Yemen under a memorandum of understanding with International Tataloat Co.
The Egyptian blue-chip index added 0.5 percent, with its biggest lender Commercial International Bank rising 3.4 percent. The Financial Regulatory Authority said it was considering the bank's request to increase its authorised capital to 50 billion Egyptian pounds ($2.80 billion) from 20 billion pounds.
Qatar National Bank Alahly rose 5 percent after reporting an increase of more than 30 percent in its annual net profit and proposing a higher dividend for the same period.
The bank also proposed a capital increase to 10.77 billion Egyptian pounds from 9.79 billion pounds by granting one bonus share for every 10 shares.
Private equity firm Qalaa Holdings added 4.3 percent. The firm signed a memorandum of understanding to buy an additional stake in Egyptian Refining Co, owned by Qatar Petroleum.
In Dubai, the index gained 0.4 percent, after three straight sessions of losses, partly lifted by gains in Emirates NBD, its largest bank.
Emirates gained 1.1 percent after reporting a 10 percent rise in its fourth-quarter net profit as loan growth and improved margins offset lower income from investment securities and higher expenses.
GFH Financial Group, whose primary listing is on the Bahrain stock exchange, added 2.4 percent after saying it had acquired Westside Office Business Park in the UK. It said it and its clients would invest up to 39.2 million pounds ($50.4 million).
However, Developer DAMAC Properties dropped 2.3 percent, having plunged nearly 10 percent in the last session after BofA Merrill Lynch downgraded the stock to 'underperform' from 'neutral'.
The Abu Dhabi index was flat with First Abu Dhabi Bank, United Arab Emirates' largest lender, slipping 0.4 percent in low volume.
Energy firm Dana Gas added 5 percent but trading was suspended after an hour ahead of a board meeting called to discuss its operations in Egypt, United Arab Emirates and Iraqi Kurdistan. The firm did not announce the results of the meeting, and trading was suspended until market close.
Qatar's index also traded flat, with Middle East's biggest lender, Qatar National Bank, shedding 0.5 percent despite reporting a increase in full-year net profit and total customer deposits. Arqaam Capital forecast a slowdown in the lender's earnings in 2019 on rising combined operating ratio, adding the bank is not immune to headwinds in Turkey.