DUBAI (Reuters) – Egypt’s stock market rose sharply early on Sunday in heavy volume, heading for a 12th straight session of gains following the International Monetary Fund’s approval of a three-year, $12 billion loan for the country.
The IMF has already disbursed an initial installment of $2.75 billion to Egypt’s central bank. The IMF loan approval had been widely expected, but this plus Egypt’s decision to float its currency on Nov. 3 has made investors optimistic that the market can look forward to major inflows of foreign money.
Analysts at Bank of America Merrill Lynch recommended buying Egyptian Treasury bills unhedged, reviving a trade that had been popular among foreign investors before political upheaval in 2011 ushered in years of economic instability.
Egypt’s blue chip stock index climbed 2.6 percent in trading volume that looked set to be the biggest daily amount on record. Financials and exporting firms were some of the top gainers, with Egypt Kuwait Holding jumping 6.3 percent and Arabian Food Industries rising as much as its 10 percent daily limit.
A few blue chips declined on profit-taking following strong gains over the past week. Telecom Egypt was down 1.7 percent.
The broader stock market index was up 2.0 percent.
(Reporting by Celine Aswad; Editing by Andrew Torchia and Jane Merriman)
