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Dec. 16 (Bloomberg) — Egypt’s stocks were set for a three- week high after the first round of voting on the new constitution, which has divided Islamists and opposition groups, passed peacefully.Orascom Construction Industries, Egypt’s largest publicly traded company, climbed 2.5 per cent. Commercial International Bank Egypt SAE, the biggest lender by market value, gained for the third time in four days. The EGX 30 advanced 1.5 per cent to 5,241.25 at 12:02 p.m. in Cairo, set for the highest close since Nov. 22, and bringing a gain in the past four days to 5.3 per cent. 20-five stocks rose, while three retreated and two were unchanged.
Yesterday’s referendum follows a wave of protests against President Mohamed Mursi’s efforts to push the charter through, sometimes escalating into violent clashes. About 57 per cent of initial-round voters approved the first constitution since Hosni Mubarak was toppled almost two years ago, according to the Muslim Brotherhood, Egypt’s biggest political organisation.
“The overall picture says we’re moving forward with no violence,” Ramy El Agamy, Cairo-based institutional sales manager at NBK Capital Securities Egypt, said by phone. “To the market, ‘yes’ means International Monetary Fund loan and parliamentary elections, both of which minimize systematic risk.”
Supporters argue the charter will pave the way for economic recovery while opposition groups say it lay the ground for Islamist dominance. The National Salvation Front, the main opposition group including Nobel Laureate Mohamed ElBaradei, said the “no” vote exceeded 66 per cent.
Plans on Hold
Egyptian shares are still down 3.6 per cent since Nov. 22, the day Mursi issued a decree to expand his powers, sparking deadly protests and compelling the leader to rescind the edict earlier this month. Mursi also suspended tax increases before the referendum and his government has asked the IMF to postpone a decision on an application for a $4.8 billion loan, originally slated for Dec. 19. The second round of constitution voting will take place Dec. 22.
Orascom Construction Industries rose to 249.44 Egyptian pounds. Commercial International Bank gained 3.1 per cent, headed for the biggest increase since Dec. 9, to 33.9 pounds.
Elsewhere in the region, Dubai’s DFM General Index fell 0.5 per cent and Abu Dhabi’s ADX General Index gained 0.1 per cent. The Bloomberg GCC 200 Index of the biggest companies in the Gulf Cooperation Council fell less than 0.1 per cent. Saudi Arabia’s Tadawul All Share Index and Kuwait’s gauge rose 0.1 per cent and Qatar’s QE Index was little changed. Oman’s MSM30 Index retreated 0.2 per cent while Bahrain’s market was closed for a holiday.
Israel’s TA-25 Index fell 0.9 per cent. The yield on the benchmark 5.5 per cent bonds due 2022 tumbled six basis points to a record 3.7 per cent.
–Editors: Daliah Merzaban, Inal Ersan
To contact the editor responsible for this story: Alaa Shahine at [email protected]