From Muhammad Idris

May 8 (Reuters) - The UAE stock markets closed lower on Friday after renewed clashes between the United States and Iran near the Strait of Hormuz negatively impacted investor confidence.

US President Donald Trump said the ceasefire was still in effect despite escalating tensions that have weakened hopes for a quick diplomatic solution to the crisis.

Dubai's main index fell 0.5 percent, ending a two-session rally, as banking stocks led the decline.

Shares in Emirates NBD Bank fell 1.4 percent, while shares in Dubai Islamic Bank dropped 2.2 percent.

Shares in Emirates Integrated Telecommunications Company (du) rose 3.1 percent after announcing a partnership with Ooredoo Group to land the VIG submarine cable in the UAE.

The project aims to support the growing demand from giant technology companies, cloud service providers, artificial intelligence platforms, and data center operators.

Daniel Takieddine, co-founder and CEO of Skylinks Capital Group, said that UAE stocks declined following renewed tensions in the Strait of Hormuz, while strong economic fundamentals and any regional de-escalation support a return to previous high levels.

The index in Abu Dhabi closed down 0.4 percent, weighed down by a 1.2 percent loss in ADNOC Gas shares and a 1.5 percent decline in Abu Dhabi Commercial Bank shares.

Oil prices, a key driver of Gulf financial markets, rose. Brent crude futures climbed 0.67 percent to $100.73 a barrel by 11:43 GMT.

Despite the decline, both indices ended the week higher. Data from the London Stock Exchange Group showed that the Dubai index rose 2.4 percent during the week, and the Abu Dhabi index climbed 0.5 percent.