Feb. 23 (Bloomberg) -- Egyptian stocks advanced on speculation that the purchase of $10 billion of Dubai bonds by the United Arab Emirates will prompt confidence in regional economies battered by the global financial crisis.

Orascom Construction Industries, the biggest publicly traded builder in the Middle East and Telecom Egypt, the largest fixed- line telephone company in the region, lead the advance.

The CASE 30 Index gained 43.25, or 1.2 percent, to 3572.06 at the close in Cairo as 20 stocks rose, seven fell and three were unchanged. The measure has declined 22 percent this year. The U.A.E. central bank bought the bonds at a reduced rate to support the emirate.

“This kind of good news definitely acts as a catalyst in the region and may make stock investors feel that we have reached the bottom,” Angus Blair, head of research at Cairo-based Beltone Financial, said in a telephone interview. “I think the Egyptian market has been oversold when one considers that the fallout from the financial crisis won’t be as bad here as in other countries.”

Egypt expects its economy to accelerate between 7 percent and 9 percent after the global financial crisis ends, Finance Minister Youssef Boutros-Ghali said in a statement today.

A bomb blast that killed a French tourist and injured at least 22 others last night in a historic district of Cairo popular with tourists is unlikely to dampen investors’ appetite for equity as the attack appears to have been amateurish and badly organized, Blair said.

Egyptian for Tourism Resorts, the third-largest publicly traded hotel company, gained 0.9 percent to 1.19 pounds, its third straight gain.

Orascom Construction Industries, the biggest publicly traded builder in the Middle East, increased 1.8 percent to 114.34 pounds. Telecom Egypt increased 2 percent to 14.51 pounds.

To contact the reporter responsible for this story: Mahmoud Kassem at mkassem1@bloomberg.net

Last Updated: February 23, 2009 08:31 EST