Main index jumps 3.3 per cent on Wednesday after Hisham Qandil's bullish growth predictions soothe investors' nerves
Egypt’s stocks saw a strong rebound on Wednesday after two consecutive declines as positive sentiment generated by government efforts to reassure investors over President Mohamed Morsi's economic plans boosted the market.
The benchmark EGX30 jumped 3.3 per cent to close at 5,755 points, spurred by gains for all but a dozen stocks. The broader EGX70 also gained 3.2 per cent.
Helping confidence was Tuesday's announcement by Prime Minister Hisham Qandil that loan negotiations with the International Monetary Fund (IMF) might be concluded in late October.
Speaking at a Cairo conference, he said the government aims for 4 per cent growth in the 2012/13 fiscal year, compared to a previous forecast of 4 to 4.5 per cent. He also detailed a five-year plan based on hitting 7.5 per cent annual growth.
"The market is strong across the board. This is on the back of the positive rhetoric that refuted everything Morsi said that had freaked out investors," an anonymous trader told Reuters.
The market plunged over 2 per cent on Monday following a weekend speech by Egypt's president in which he said that certain, unnamed companies had committed violations and would be investigated.
Foreign investors were fairly bullish, buying LE5.1 million more in stocks than they sold.
All blue-chip stocks gained, led by the Commercial International Bank and Orascom Construction Industries which rose 5 per cent and 2.5 per cent, respectively.
Shares in Orascom Telecom and Ezz Steel climbed 2.3 per cent apiece.
The property sector saw sustained interest, with the likes of the Talaat Mostafa Group, Six of October Investment and Development and Palm Hills Development soaring 6.3, 4 and 3.4 per cent, respectively.
Despite the giant rise of the indices the market saw a relatively modest turnover of LE574 million ($94.2 million).