DUBAI (AFP) - Dubais stock market closed 7.0 percent higher on Thursday, its biggest gain since the debt crisis exploded, and led by Emaar Properties after it called off a merger with state-owned entities. The Dubai Financial Market index closed 107.4 points up at 1,640.76 points. Shares in Emaar,the Middle Easts largest property firm by market capitalisation, closed 14.84 percent up, at 2.94 dirhams (80 US cents), after heavy trading and wide fluctuations. Like Emaar, several leading shares also surged close to the maximum daily gain of 15 percent, including Dubai Islamic Bank, which rose by 14.53 percent. Total trade surged to 1.113 billion dirhams (305 million dollars), with 27 out of 28 traded companies posting gains. The market opened slightly higher, but plunged by more than four percent within less than half an hour before rising to its highest close since November 25. It was then that Dubai requested a freeze on debt repayments by its largest and most indebted group, Dubai World, liable for 59 billion dollars. The losses on Wednesday brought with them a cumulative decline of over 26 percent since Dubais debt alert, erasing all the gains made this year. Thursdays surge was only the second time the market has closed in green since then. Emaar said late on Wednesday it had decided to cancel merger plans with the the heavily indebted property arm of government-owned Dubai Holding. Talks had been ongoing to link Emaar and three Dubai Holding property units Dubai Properties, Sama Dubai and Tatweer. With this news that the planned merger has been called off, a large degree of uncertainty and overhang from this potential merger has dissipated, said regional investment bank EFG-Hermes in a statement. It said that cancelling the merger talks shows that a distinction is being made between 'good and 'bad assets, as well as 'corporate and 'sovereign assets. Meanwhile, the government utilities firm Dubai Electricity and Water Authority denied reports that its long-term debt might be redeemed early due to Dubai Worlds debt problems. The news ... has nothing to do with the truth. We dont have any possibility of lenders asking for early payments nor are we planning to delay anything, Emirates Business daily quoted top company official Abdullah al-Hajri as saying. The Financial Times had reported on Wednesday that the firms 2.0-billion-dollar securitisation programme, originally maturing in 2036, may have to be redeemed in full on December 14 the day Dubai Worlds property developer, Nakheel, is due to redeem its 3.5-billion-dollar sukuk bond. In other Gulf markets, Abu Dhabi recovered 1.43 percent to 2,502.24 points at closing after it was down 1.33 percent in early trading. Construction and real estate led the early drop by 3.06 percent and 2.94 percent respectively. Construction reduced its losses to just 0.10 percent by the end of trading, while real estate recovered 3.6 percent. In Qatar, the stock market recovered on Thursday, closing 1.19 percent up after dropping 1.99 percent on Wednesday. The Kuwait Stock Exchange closed 0.21 percent up after it was down 0.1 percent around midday. The Saudi bourse, the Gulfs largest, was shut for the weekend.