Bloomberg News

Egypt Shares Fall Most in Three Weeks After PM’s Economy Warning

December 12, 2011

Dec. 12 (Bloomberg) -- Egyptian shares declined the most in almost three weeks after Prime Minister Kamal el-Ganzouri said austerity measures may be required to counter a deterioration of the economy.

Orascom Construction Industries, the country’s largest publicly traded builder, fell for a sixth day. Commercial International Bank SAE, the biggest publicly traded lender, declined the most since Nov. 22. The benchmark EGX 30 Index lost 2.1 percent, the biggest drop since Nov. 22, to 3,882.17 at the 2:30 p.m. close in Cairo.

El-Ganzouri’s government inherited an economy that grew at the slowest pace in at least a decade after turmoil that accompanied Hosni Mubarak’s ouster in February stifled tourism and deterred foreign investment. The prime minister’s remarks outweighed an announcement from Orascom it won a $100 million share in a contract and a statement by Six of October Development & Investment Co. it sold all units available in the Westown Residences project in two days.

“The political and economic situation overshadows any positive company news,” said Mohamed Radwan, head of international sales at Pharos Holding for Financial Investment in Cairo. “In general, the mood is bearish.”

The pound dropped 0.1 percent to 6.0231 against the dollar at 4:15 p.m. in Cairo. The currency has declined 3.6 percent this year after a popular uprising toppled Mubarak. The country’s international reserves tumbled 44 percent in the first 11 months, according to central bank data.

Orascom Construction lost 0.8 percent to 207.51 pounds. Commercial International Bank plunged 4.4 percent to 21.37 pounds. Six of October tumbled 3.8 percent to 10.16 pounds, the lowest level since February 2009.

--Editors: Ash Kumar, Shanthy Nambiar

To contact the reporter on this story: Alaa Shahine in Dubai at asalha@bloomberg.net

To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net


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