Egypt’s shares surged to the highest level since the first days of last year’s uprising as prospects of foreign direct investment from the U.S. and oil- rich Gulf Arab states boosted investor confidence.
Commercial International Bank Egypt SAE (COMI), the country’s biggest publicly traded lender, climbed to the highest level since April 2011. Ezz Steel (ESRS), Egypt’s largest producer of the material, jumped to the highest since July 2011. The benchmark EGX 30 Index (EGX30) climbed 1.6 percent to 5,697.48 at the close in Cairo, the highest since Jan. 26, 2011.
Egypt’s benchmark has surged 57 percent this year, making it the best performer among 92 gauges tracked by Bloomberg. The measure rose 3.4 percent in the last four days as U.S. and Saudi Arabian businessmen held meetings with government officials in Cairo to discuss investment opportunities. Qatar pledged last week $18 billion of investments in the North African country and Prime Minister Hisham Qandil said Egypt seeks to complete talks for a $4.8 billion loan from the International Monetary Fund by the end of November.
“FDIs are the name of the game,” said Ashraf Akhnoukh, Cairo-based senior manager for Middle East and North Africa markets at Commercial International Brokerage Co. Investors are looking at pledges from Qatar, Saudi Arabia and the IMF and interpreting it as a sign that “Egypt is a safer investment environment even though we may not be that stable yet,” he said.
Last year’s revolt ousted President Hosni Mubarak after a three-decade reign and prompted the Egyptian Exchange to halt trading for about two months. The benchmark index tumbled 49 percent in 2011.
EFG-Hermes Holding SAE, the biggest publicly traded Arab investment bank, raised Egyptian equities today to overweight from neutral, citing increased political stability and improved prospects for external financing. CIB and carmaker GB Auto (AUTO) were added to the investment bank’s Middle East and North Africa Top 20 list.
CIB rose 1.3 percent to 32.88 Egyptian pounds. Ezz Steel advanced 4.4 percent to 10.41 pounds. GB Auto climbed 4.5 percent to 25.9 pounds, the highest close in a year.
Shares valued at about 944 million ($155 million) exchanged hands today, the highest level since June 2011.
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