Egypt's stock exchange bounces bank
Egypt’s stocks rebounded, Wednesday, buoyed by positive news from the Central Bank of Egypt and the US government that the economy is recovering, just one week after dropping for three consecutive sessions.
The main index EGX30 rose by 0.7 per cent recording 5.656.13 points driven by the central bank's monthly report, which confirmed that the state’s FDI grew by an impressive 66 per cent in the fourth quarter of the fiscal year 2011/12 over the previous quarter.
FDI reached $1.9 billion in the quarter ending June 2012, up from $635 million recorded in the quarter ending March.
"The rise of FDI helps assuage investors’ panic after the rumour of an Egyptian armed intervention in Syria," said Eissa Fathy, the head of securities division at Cairo's Chamber of Commerce.
Fathy added that the American government's attempts to send economic aid to Egypt helped stimulate the market.
The US State Department announced Monday it would work with Congress to try to unblock some $450 million in economic aid for Egypt in two tranches.
The broader index EGX70 rose 0.3 per cent in a session where Egyptians and Arabs were net-buyers with LE5.5 million and LE15.8 million respectively. Foreign investors sold some LE22.1 million.
Most of the heavyweight shares also increased, led by Commercial International Bank and Orascom Construction Industries, which rose by 1 per cent and 0.7 per cent respectively.
"OCI’s share becomes attractive for Egyptians especially after its price slumped from LE305 to LE280", Fathy told Ahram Online.
Orascom Telecom and Ezz Steel rose by 2.2 per cent and 2 per cent respectively.
Property shares also performed well: Egypt's Palm Hills and SODIC increased by 1.1 per cent and 0.2 per cent respectively. Talaat Mostafa Group declined 0.5 per cent.