Egyptian shares join world rally, OCI and OT lead

Alaa Shahine
3 Min Read

CAIRO: Egyptian shares followed global markets higher on Monday after governments across the world took new measures to rescue troubled banks and Egypt s pledge to guarantee lenders and deposits.

Market heavyweight Orascom Construction Industries gained 5.54 percent to last trade at LE 238.85 ($43.19). Regional mobile phone operator Orascom Telecom jumped 7.85 percent to LE 36.

Banks and financial stocks also gained, with EFG Hermes, one of the largest Arab investment banks, last traded 1.1 percent higher at LE 26.65 a share. Commercial International Bank, Egypt s top privately-owned bank, rose 4 percent to LE 35.88.

This is a reaction to what is happening with world markets, said Hashem Ghoneim of El Nour Securities.

And of course the market was really down so we were expecting a rebound.

The benchmark CASE 30 index, which had tumbled nearly 50 percent this year to Sunday s close, jumped 4.90 percent to 5,760.90 points.

The Hermes index gained 3.62 percent to 515.02 points, while the CIBC index rose 1.06 percent to 303.11 points.

World stocks jumped on Monday from last week s five-year low after policymakers around the world took new and drastic steps to rescue banks and prevent the global economy from sinking into recession.

The Egyptian central bank also weighed in, saying on Sunday it would guarantee all deposits and reassuring markets that the bank s foreign reserves and the overseas positions of Egyptian banks were secure.

Central Bank Governor Farouk El-Okdah said monetary policy would act to support economic growth and will not ignore the turmoil in financial markets, an indication that a cycle of raising interest rates may come to an end.

Teymour El-Derini, a trader at Beltone Financial, said while the market welcomed the reassurances from the government and central bank, the main reasons behind Monday s rally were the upward trend in global markets and the bargain-hunting by foreign investors.

Bucking the upward trend were firms like brokerage house Pioneers Holding, which plunged 14.44 percent to LE 6.40 a share.

It is a brokerage business and volume-based, so when the market is crushed and there is less volume, this means less revenue-generation for them, Derini said.

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