Egypt’s Stock Exchange Rockets By 14 Pct After Pound Devaluation

By Aswat Masriya

Cairo – Egypt’s main stock index climbed 3.6 per cent on Thursday, closing off the week with a surge of 14 per cent.

The bourse’s upsurge throughout the week was triggered by investor optimism following the devaluation of the Egyptian pound on Monday by 112 piastres, to reach 8.85 against the dollar instead of 7.73. The move signified a drop of 14.5 per cent.

After depreciating the pound on Monday, the Central Bank of Egypt (CBE) said it was adopting a more “flexible exchange rate regime,” adding “that it will not hesitate to use all its tools and authority to maintain an orderly foreign exchange market.”

However, in an auction on Wednesday, the CBE raised the Egyptian pound 7 piastres, to reach EGP 8.78 against the dollar during an exceptional auction.

In today’s trading session Arab and foreign investors were inclined towards purchases while Egyptian investors preferred selling.

Ehab Saeed, an analyst working with Osool ESB Securities Brokerage, said that the market’s strong surge continued following the decision of the devaluation of the Egyptian pound.

Saeed added that EFG-Hermes Holding’s announced approval of the sale of 40 per cent of its stake in Lebanese commercial bank Credit Libanais reinforced Thursday’s stock market rise.

Hermes announced today it approved of selling 40 per cent of its shares in Credit Libanais at $33 per share.

Hermes’ share was the highest among share values on Thursday with an increase of 14.04 per cent, leading the bourse to halt trade on the share for 30 minutes due to its exceeding the margin of five per cent.

Source: All Africa