CAIRO: Egyptian shares surged on Wednesday after Egypt s third mobile license sold for $2.9 billion at an auction, a price that exceeded expectations and injected confidence into the market, traders said. Telecoms shares were up across the board after the United Arab Emirates Etisalat won Tuesday s auction with its LE 16.7 billion bid. Shares in current mobile operator MobiNil gained 2.6 percent to close at LE 160, while Vodafone rose 2 percent to LE 93. Yesterday s surprise selling price for the third mobile license boosted morale and investor confidence. We have seen dormant investors who had been on the sidelines coming back aggressively and picking up stock, said Mohammed Radwan of Delta Securities. He said the telecoms sector continued to be the main focus of the market. Telecom Egypt, whose bid for the mobile license was the fourth highest of nine, rose 12.2 percent to LE 13.09. Shares in Orascom Telecom, the dominant shareholder in MobiNil, rose 4.5 percent to close at LE 260. The benchmark Hermes index rose 5.4 percent to 47,050.39 points. The broader CIBC index closed 2.9 percent higher at 198.77 points, and the Case 30 gained 5.2 percent to close at 5,282.40 points. The hares in EFG-Hermes, the heaviest stock traded by turnover, gained 16.6 percent to close at 31.48 pounds after Horus, one of the bank s private equity funds, bought a non-controlling stake in Al Watany Bank of Egypt on Tuesday. Traders said positive market sentiment over the telecoms deal had also helped push the stock higher as retail investors snatched up shares. Shares in Orascom Hotels and Development also gained, rising 12.3 percent to close at LE 32 after the company said it had submitted a bid to buy 625 hectares (1,560 acres) of prime land on the Mediterranean coast. Commercial International Bank, a minority partner in the winning coalition led by Etisalat, dropped 3.3 percent to end at LE 62.77 after gaining 7.8 percent on Tuesday. One trader said the stock may have dropped because investors worried the amount of money paid for the license may have been too high to realize quick profits from the deal. Reuters
Shares soar after mobile auction, telecoms up
