Traders work at the Egyptian stock exchange in Cairo, Egypt, March 8, 2016 (Reuters)
Egypt's stocks surged on Monday after the central bank devalued the pound by almost 15 percent in a move aimed at adopting a more flexible exchange rate.
The Central Bank of Egypt (CBE) sold $198.1 million to local banks in a $198 million exceptional auction earlier Monday at a rate of EGP 8.85 per dollar, up from 7.73 in previous auctions, CBE stated on its website.
Benchmark index, EGX30, climbed 6.7 percent to 7,003 points and daily stock turnover hit the highest since May 2014 at EGP 1.4 billion.
“The market expects investments to rise following the devaluation of the pound as investors can now repatriate their profits at the official exchange rate," Ihab Saied, head of Research at Osool for securities brokerage, told Ahram Online.
Non-Arab foreign investors were the only net buyers at an amount of EGP 27 million with 13 percent of trade.
Market bellwether, Commercial International Bank (CIB), real estate developer Palm Hills for Development (PHD) and Orascom Telecom Media and Technology (OTMT) garnered around a third of the day's turnover.
The CIB share gained 6.82 percent to EGP 40.05, PHD climbed 7.36 percent to EGP 2.5 and OTMT increased 4.76 percent to EGP 0.64 per share.
The real estate sector and construction materials were of the most prominent gainers in the main index, with steel manufacturer Ezz steel rising 8.1 percent to EGP 9 per share, real estate developer Emaar Misr for Development coming up 7.76 percent to EGP 2.59 a share.
Leading real estate developer Talaat Moustafa Group Holding (TMG) grew 7.71 percent to EGP 5.7 per share and Six of October for Development and Investment Company (SODIC) jumped 7.64 percent to EGP 8.06 per share.