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Reuters
Egypt’s stock market closed the week at a record high on Thursday as foreign funds continued to buy, while Gulf markets inched up on the back of firmer crude oil and global bourses. Cairo’s index closed 1.7 percent higher at 12,824 points in the heaviest traded volume since mid-November.
“Since the float of the currency on Nov. 3 the market has not witnessed a correction and foreign funds have been flooding the market with fresh money, helping maintain positive appetite towards equities,†said Mohamed El Nabarawy, head of asset management at Cairo’s HC Securities & Investment.
Eighty percent of traded shares in the EGX30 index were bid up on Thursday, with Palm Hills Development jumping 5.1 percent. On Wednesday, the developer surged 8.5 percent after signing an agreement with the Ministry of Housing to buy a major plot in West Cairo for a new project near its existing developments.
Egypt’s net foreign reserves rose to $24.265 billion at the end of December from $23.058 billion at the end of November after the disbursement of loans from foreign donors, the central bank said on Thursday.
Nabarawy said this would help boost confidence that Egypt’s currency drought was starting to reverse, though over the long term, dollar inflows should come primarily from foreign direct investment, tourism and exports. “Non-loaned sources of inflows are more productive in the long term than borrowed money.â€
Positive sentiment in global stock markets spread to Gulf bourses, supporting those markets most exposed to foreign funds. Dubai’s index rose 0.3 percent to 3,628 points but traded volume dropped by roughly a third from Wednesday.
The index rose 2.7 percent this week, nearing technical resistance at the mid-December peak of 3,659 points. Dubai Islamic Insurance and Reinsurance jumped 14.0 percent to 1.09 dirhams on Thursday in its heaviest trade since early 2014.
The stock soared its 15 percent limit on each of the previous three days, and it has doubled in price since Dec. 27. Some traders speculate there may be mergers in the insurance industry following last year’s news of a big Abu Dhabi banking merger.
Dubai Investments rose 3.7 percent after announcing on Wednesday the launch of a new 3 billion-dirham ($817 million) real estate project in Dubai.
Doha’s index, another market actively traded by foreign funds, recouped early losses to add 0.3 percent and finished the week up 2.4 percent. Telecommunications provider Ooredoo closed 0.3 percent higher at 105.30 riyals, 1.7 riyals above its intra-day low.
Saudi Arabia’s index closed on the day and dropped 0.2 percent in the first week of the year. The petrochemical sub-index swung 0.2 percent higher after Brent oil futures bounced 2 percent overnight and climbed back near $57.00 a barrel. Bellwether Saudi Basic Industries rose 0.5 percent.