[2007-10-25]  Banking shares help push Egypt bourse to new highs
Banking shares, buoyant after news of a possible merger between Commercial International Bank and Arab African International Bank, pushed Egypt's benchmark stock index to new record highs on Tuesday.

The two lenders said on Monday they have agreed to start due-diligence studies that could lead the creation of Egypt's biggest private bank.

"This was huge. CIB and Arab African are among the best banks in town," said Sarah Tolba, international desk trader at Delta Securities. "This pushed most banking shares today."

The benchmark Case 30 index cruised to a fresh record high for the third straight session, gaining 0.5 percent to 8,812.90 points. The well-watched Hermes index rose 0.7 percent to 77,315.57 points.

Housing and Development Bank led the way up, soaring 16 percent to last trade at 55.87 Egyptian pounds ($10) a share. Credit Agricole rose 1.2 percent to 18.23 pounds, while National Societe Generale Bank jumped 11 percent to 45.49 pounds.

CIB, which rose to an all-time high after the announcement of the possible merger on Monday, trimmed its gains on Tuesday to last trade 0.5 percent up at 80 pounds.

"The share had been rising before the news, so it is natural to see some profit-taking today," said Mohamed Kotb of Jazira Asset Management.

Shares in Egyptian Resorts Company bucked the trend, shedding 3.7 percent to 11.74 on rumours that an auction set for Tuesday to sell the government stake of around 24 percent in the firm would not fetch more than 11 pounds a share, traders said.


Source: © Reuters 2007.