Egyptian equities hit their highest level all year as Qatari investors prepare bids for Egypt's banks and foreign reserves rise.
Egyptian banks find favour with investors
Egyptian equities closed at the highest level all year as the country’s foreign currency reserves rose and investors bet on the country’s banks. The EGX30 Index of Egyptian equities rose 0.6 per cent to 5,459.92.
The market measure has gained 50.6 per cent since the start of the year, making Egypt the world’s second-best performing stock market after Venezuela.
Lenders led the gains, with National Société Générale Bank, the Egyptian unit of France’s second-biggest bank, rising 10 per cent to 38.24 Egyptian pounds each, having risen by the same amount on Sunday following the announcement of takeover talks with Qatar National Bank.
Other lenders provided much of the early momentum before paring gains. Commercial International Bank gained 0.2 per cent to 31.68 pounds per share, while EFG Hermes gained 0.6 per cent to 12.43 pounds each.
The investment bank is due to host a shareholder meeting on September 16 to discuss the creation of a joint venture with Qatar’s QInvest.
The boost also came as the central bank of Egypt said its foreign reserves rose 4.8 per cent last month to US$15.5 billion.
“This was only the third monthly increase in reserves since the January 2011 revolution, and was the largest single rise over that period,” analysts from HSBC wrote in a research report.
The Dubai Financial Market General Index gained 0.1 per cent to close at 1,547.66, while the Abu Dhabi Securities Exchange General Index was left unchanged at 2,556.82.
Saudi stocks tumbled despite the release of improving economic data. The Saudi Tadawul All-Share Index fell 0.1 per cent to 7,078.53.