Egypt bourse reopens Tuesday, pound falls further

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CAIRO: Egypt’s stock exchange urged citizens to exercise their duty to vote in the parliamentary elections, and announced the bourse will be closed on Nov. 28, the start of the first phase of voting.

With Sunday already a holiday for Islamic New Year, this means Egypt’s market will reopen for trading on Nov. 29.

“The bourse management believes that every Egyptian has a duty to exercise the right to vote…in the legislative elections. In view of what is on the mind of every Egyptian, hoping for a better future in a free country, and in recognition of the importance of the electoral process — especially in the first phase that includes Cairo…management has decided to consider Nov. 28 a day off,” the statement read.

By the end of Thursday’s trading session, the EGX 30 was up 1.69 percent while the broader EGX 100 rose 1.71 percent.

Meanwhile, the Egyptian pound weakened to more than 6 to the US dollar for the first time since January 2005, Reuters reported. The pound traded as weak as 6.0025 the dollar before settling around 6.0010.

"The central bank is doing an admirable job at trying to maintain stability in the currency despite strains internally from poor sentiment surrounding the protests," Angus Blair of Beltone Financial told Reuters.

Also on Thursday, ratings agency Standard & Poor’s pushed Egypt’s sovereign credit ratings deeper into junk status, citing the country’s dire political and economic situation and the increased risk of civil strife, AP reported.

The stock market had lost LE 29 billion in total market cap by Tuesday, as democracy protests once again rocked the nation with Tahrir Square as the epicenter. The market regained some losses on Wednesday as the benchmark index closed up 1.1 percent.

Egypt had shuttered its market for nearly two months after the start of the January uprising caused investors to flee. Faced with similar protests this week, it has not, however, taken the same measures.

Since Saturday, protesters have been facing off with security forces, who used batons, tear gas and birdshot in attempts to clear the iconic square. The death toll reached 38 with hundreds of injuries.

Nationwide protesters are demanding that the ruling Supreme Council of the Armed Forces (SCAF) swiftly cede power to a civilian authority. The army council has accepted the resignation of Prime Minster Essam Sharaf’s Cabinet, and has said elections will proceed as planned.

However, this has not satisfied activists and protesters around the country calling for the formation of a salvation government or a presidential council in place of the ruling army council, which came to power after the ouster of Hosni Mubarak.

Investors and analysts had predicted that the market would gradually pick up after Mubarak’s ouster, in hopes that putting an end to the regime’s corruption and getting rid of the lingering question of succession would boost investor confidence and the overall economy.

However, the transition phase has been marked by uncertainty and what many see as an unclear path to the democratic civilian rule Egyptians have been demanding.

Meanwhile, foreign reserves have dwindled to $22.1 billion, from $36 billion in January, and tourism — one of the pillars of the economy — has not nearly recovered.

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