Riots in Egypt have shut down business operations and kept the nation’s stock market (EGX) closed for a second day after it fell 16% last week.
Its ripple effects have been most visible in Abu Dhabi and Dubai where shares plummeted to a 14 and 8 month low respectively, according to Bloomberg.
Emaar Properties PJSC, a Dubai-based company on the Dow Jones Arabia Titans Index, is said to be Egypt’s biggest foreign direct investor and lost 8.3% in the real-estate sector, Bloomberg reported.
The unrest has hurt yields on Egypt’s dollar bonds that mature in 2020, which reached their highest since they were first issued in April 2010, jumping 67 bps to 6.97% on Friday. Credit-default swaps insuring Egyptian debt jumped 123 bps last week Bloomberg reported.
While Egyptian businessmen are fleeing the country, international companies have begun to suspend operations and evacuate their expatriates. Oil magnate, Hussein Salem who has a 28% stake in East Mediterranean Gas also fled the country, while the company saw its shares drop on Israel’s TA-25 Index which fell 3.8%.
All of Heineken’s expatriate employees were evacuated and local employees were asked to stay home as operations were shut down according to the Wall Street Journal. Nissan is keeping its operations shut through Thursday, GM’s operations have been disrupted as well while Coca Cola’s Cairo plant suspended operations till the unrest settles down.
Though the Suez Canal is safe for commerce now, Danish shipping and oil giant A.P. Moller-Maersk which has 7,000 employees in Egypt and operates in the Suez canal has suspended activities for the moment according to Reuters.
Some like Egyptian billionaire Naguib Sawiris however see the unrest as a step towards democracy. He has taken contrarian investing to a whole new level and is reportedly buying up Egyptian stocks.