Egypt’s benchmark index ends the session on a seven-month high after a series of upbeat government forecasts for the economy encourages investors to bolster equity positions ahead of the New Year, traders say.
The government’s announcement of an off-budget economic stimulus worth up to $3.4 billion and forecasts of accelerating economic growth have bolstered prospects for corporate earnings.
Stocks benefiting the most from renewed investor interest include Ezz Steel, Commercial International Bank and Orascom Construction, which this month are up 4.6 percent, 11 percent and 6.1 percent respectively.
Ezz Steel closes up 2.2 percent, CIB 2.3 percent and OCI 0.4 percent. The index ends at 7,077 points, its highest since May 6.
OCI is the most traded stock, with LE 68 million ($11.7 million) of its shares changing hands, well above a 40-session daily average of 36 million pounds. The next most active are Talaat Moustafa and Orascom Telecom.
Traders say most investors have stayed on the sidelines over the year-end holiday period but some local high-net worth and retail investors are buying, encouraged by the index’s push above 7,000 points.
"There have been some positive statements coming from government officials in the past four to six weeks and people are attributing the index’s rise above 7,000 points to that," says Mohamed Radwan of Pharos Securities.
Radwan says the latest government comments on the economy point to an increase in state infrastructure spending that would boost many industrial sectors.
Private equity firm Citadel Capital, the focus of much investor interest this week, is unchanged at LE 9.2. The stock is up 20 percent over the last five sessions.
