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Egypt bourse hits 10-week high on positive business outlook

Successful 'reconciliation' deals with Mubarak-era tycoons whet investors' appetites, pushing Egypt's benchmark EGX30 index to 10-week high

Ahram Online, Sunday 12 May 2013
File photo: A trader works at the Egyptian stock market in Cairo (Photo: Reuters)
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Views: 921

Egypt's benchmark EGX30 index climbed to a ten-week high on Sunday, pushed upwards by positive sentiment regarding Egypt's business outlook following recent 'reconciliation deals' with Mubarak-era businessmen.

The index rose 0.78 percent to 5,446 points – maintaining its rally for the sixth consecutive day – in a session that saw a modest LE228 million in turnover.

"The market is recovering because we now see a degree of business credibility, especially after the reconciliation deal with Orascom Construction Industries and the possible return of former trade minister Rachid Mohamed Rachid," Mohamed Kotb of Cairo-based Naeem Brokerage told Ahram Online.

Kotb expects the market to extend its gains to 5,600 points as Orascom Construction Industries (OCI) moves ahead with plans to transfer its shares to the Amsterdam bourse.

Blue chips that recorded gains on Sunday included OCI, the market's largest listed company in terms of paid-in capital, which rose by 2.1 percent; and Commercial international Bank (CIB), which climbed by 1.1 percent.

The communications sector helped push the market up, with Mobinil rising by 0.9 percent, landline monopoly Telecom Egypt by 0.8 percent and Orascom Telecom by 0.2 percent.

Kotb, however, described recent market gains as "fragile," as investors await the fate of a proposed $4.8 billion loan from the International Monetary Fund and the performance of new economy ministers appointed last week in a cabinet reshuffle.

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