Egypt shares rise but Ramadan lull limits gains

Published: Updated:

Egypt’s shares open higher after Gulf countries pledged billions of dollars in aid, but gains are limited by thin trading due to the start of the Ramadan fasting month.

After Tuesday’s close, Saudi Arabia announced $5 billion in aid for Egypt, including central bank deposits, energy products and cash, while the United Arab Emirates offered $3bn in grants and loans.

“The market did not react as expected; the money from the UAE and Saudi Arabia was a surprise, but it’s the first day of Ramadan and people are digesting the news,” says Mohamed Radwan, director of international sales at Pharos Securities.

Another positive is the choice late on Tuesday of an interim prime minister, which suggested the country is moving back towards civilian rule after the military ousted president Mohamed Mursi last week.

Radwan said the steps towards forming a government would gradually be factored into share prices.

Cairo’s benchmark index gains 0.2 percent to 5,302 points, having rallied 3.3 percent in the previous session on optimism over a swift plan for parliamentary and presidential elections.

Gulf markets are mixed in thin trading because of Ramadan.

Dubai’s benchmark climbs 0.5 percent to 2,356 points, while Saudi Arabia’s bourse is flat.