Egyptian Stocks Advance After 22% Plunge, Led by Developer Six of October
Egyptian Stocks Advance
Shawn Baldwin/Bloomberg
A financial trader at the Egyptian stock exchange in Cairo.
A financial trader at the Egyptian stock exchange in Cairo. Photographer: Shawn Baldwin/Bloomberg
Egypt stocks climbed to the highest level since January, led by Six of October Development & Investment (OCDI) Co., on investor speculation declines in real-estate shares last month were overdone given growth prospects.
Six of October, a luxury developer, jumped 8 percent, trimming the drop since trading resumed March 23 after an almost two-month suspension to 15 percent. Palm Hills Developments SAE (PHDC), a Cairo-based property company, gained for the first time in 10 trading days. Egypt’s EGX 30 Index (EGX30) advanced 1.7 percent to 5,558.64 at the 2:30 p.m. close in Cairo. The index has lost 1.6 percent since trading resumed. Dubai’s measure fell today, while Israel’s benchmark index rose 0.8 percent.
“Real-estate stocks are attractive as they have become extremely discounted,” said Ashraf Akhnoukh, senior equity sales trader at Cairo-based Commercial International Brokerage. “The sector was the worst performer since the market resumed trading.”
The EGX 30’s 22 percent plunge this year has left the index valued at 1.5 times book value, compared with about 1.9 times at the end of 2010, data compiled by Bloomberg show. Palm Hills has tumbled 43 percent since trading resumed and Talaat Moustafa Group (TMGH) Holding, Egypt’s biggest publicly traded real-estate developer, has slumped 28 percent. Neither the EGX 30 nor the broader EGX 100 have subindexes, according to data on Bloomberg.
Trading in Egypt was halted since the end of January until last month amid protests that ousted former president Hosni Mubarak in February.
‘Attractive Risk’
Amer Group Holding (AMER), which develops hotels, malls and restaurants, gained 4.4 percent today to 1.44 pounds, trimming the drop since the end of January to 23 percent. Beltone Financial initiated the shares with an “add” recommendation and a price estimate of 2.8 pounds. “The stock has been over- penalized,” Beltone analysts Harshjit Oza and Ahmed Khalil wrote in a note March 31. “The stock offers an attractive risk reward at the current price.”
Six of October soared to 68.46 pounds. Palm Hills surged 8.1 percent, the most since March 2009, to 2.79 pounds and Talaat rose 4.4 percent to 4.73 pounds.
In the Persian Gulf, the Bloomberg GCC 200 Index (BGCC200), Abu Dhabi’s ADX General Index (ADSMI) and Qatar’s QE Index (DSM) gained 0.1 percent. Oman’s MSM30 Index (MSM30) rallied 1 percent, while Bahrain’s BB All Share Index fell 0.5 percent and Kuwait’s measure dropped 0.4 percent. Dubai’s DFM General Index (DFMGI) and Saudi Arabia’s Tadawul All Share Index (SASEIDX) retreated 0.1 percent.
In Israel, the benchmark Mimshal Shiklit government bond due January 2020 was little changed, with the yield on the 5 percent note falling 1 basis point to 5.25 percent.
To contact the reporters on this story: Zahra Hankir in Dubai at zhankir@bloomberg.net; Alaa Shahine in Dubai at asalha@bloomberg.net
To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net
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