Ever since the Egypt’s military took over after massive protests rocked the country, cheap valuations and political stability bolstered Egyptian stocks and country-specific exchange traded fund.
The Market Vectors Egypt ETF (NYSEArca: EGPT) has surged 35.8% since the June 24 low. EGPT, though, is still down 2.1% year-to-date.
The Egyptian benchmark EGX 30 Index increased 18% in the third quarter, the largest advance since the 24% advance in the third quarter last year, reports Ahmed A. Namatalla for Bloomberg.
Investment Minister Osama Saleh attributes the uptick to Egyptian investors who are returning after the military took over on July 3 from President Mohamed Mursi.
“There has been local demand seen in the stock market, which will attract foreign buyers,” Investment Minister Saleh said in the article. “Investors are becoming more confident in the new cabinet and new administration expectations, which is partly responsible for the rise in assets.”
Parliamentary elections could take place as soon as the first quarter of 2014.
“The military’s action was viewed as bringing more stability,” Walid Mourad, a manager at ING Investment Management Middle East Ltd., said in the Bloomberg article. “There are buying opportunities if investors are selective.”