Egypt’s Orascom Telecom rebounded Thursday after a newspaper report said Algeria was close to resolving a long-running row with the Cairo-listed firm’s Algerian unit Djezzy.
Shares in Orascom Telecom jumped 7.6 percent to a three-week high. They had slumped to a seven-week low Wednesday after the company announced a widening fourth-quarter net loss.
Algeria will sign an agreement next week with Orascom’s parent company Vimpelcom regarding Djezzy, an Algerian newspaper reported. Djezzy has been embroiled in a protracted dispute with the government during which the firm has been hit by back-tax demands, threatened with nationalization and put under a criminal investigation. Traders in Cairo said the agreement could pave the way for Algeria to buy a stake in Djezzy.
Cairo’s index rose 2 percent, climbing for a second day since Tuesday’s 2013 low as bargain hunters returned. A possible delay in upcoming parliamentary elections also boosted market sentiment.
An Egyptian court ordered the cancelation of President Mohammad Mursi’s decree calling for parliamentary elections, forcing a likely delay to polls due to start in April.
“It gives time for the opposition to reconcile and find a resolution on common ground,” said Mohammad Radwan, director of international sales at Pharos Securities.
Gainers in the shares outnumbered losers five to one.In Dubai, renewed buying of property-related stocks helped the emirate’s index climb 0.4 percent, rebounding from Wednesday’s four-week low.
Investors have booked gains since Dubai hit a 29-month high in late February. Shares in Dubai’s bellwether Emaar Properties have gained 1.1 percent. Builder Arabtec snapped a five-session losing streak, closing 3.9 percent higher.
The stock is down 28.3 percent since the company announced plans to raise its capital through a 4.8 billion dirham ($1.31 billion) rights issue and a 1.7 billion dirham convertible bond.
“If they want to relieve stress on the stock, they should increase the value of the convertible bond and decrease the value of the rights issue,” said Anastasios Dalgiannakis, institutional trading manager at Mubasher.
The convertible bond would bring in new investors, he added. Banks weighed on the neighboring Abu Dhabi index, which fell 1 percent. The market declined 2.4 percent this week, down from Feb. 27’s 40-month peak. First Gulf Bank dropped by some 4.9 percent after reaching its ex-dividend date. Abu Dhabi Islamic Bank fell 1.7 percent. In Kuwait, the index gained 0.3 percent, rising to a near 25-month high.
“People are already forecasting Q2 and if the trend continues, we will have another bullish rally,” said Fouad Darwish, head of brokerage at Global Investment House.
“There are things coming together in Kuwait,” added Darwish.
“The biggest stimulant will be government projects.” Along with a more stable political backdrop after months of turmoil, investors are optimistic that the government will kick-start long-delayed infrastructure projects. These are part of a 30 billion dinar ($107 billion) development plan due to end in 2014.SHOW MORE