The Egyptian stock exchange started repairing the damage caused by the recent financial crisis in Dubai, closing up 172 points yesterday, a gain of 2.8 percent.
Stocks recovered LE8.8 billion yesterday, putting the total sum restored at about LE15 billion. Total losses during the recent tumult have come to LE56.5 billion. The losses began last Monday when the government of Dubai announced that it would defer on approximately US$80 billion in loans.
Meanwhile, markets in the Gulf remained calm. The Doha market recorded an increase of 5.3 percent, Saudi Arabia 0.8 percent, and Oman 0.5 percent. Other markets declined, such as Kuwait with a 1.4 percent loss and Bahrain with a decline of 0.12 percent. The stock exchanges in Dubai and Abu Dhabi were closed yesterday for a two-day national holiday.
Mohamed Abdel Rahim, a financial analyst, said that the Egyptian market’s rebound has been driven by similar increases in American and European stock exchanges. According to Abdel Rahim, this came as a comfort to Arab and foreign investors. Abdel Rahim also cited recent international reports that state that the Dubai crisis will bring investors to the Egyptian exchange.
Fouad Shaker, secretary general of the Union of Arab Banks, said in a press conference yesterday that the total of assets currently available in Emirati banks were worth US$397.5 billion at the end of June 2009, compared to US$253.4 billion in the same period last year. The capital of Emirati banks stood at US$49.4 billion last June compared to US$45.4 billion in the same period last year.
Shaker stressed that the banks are committed to maintaining international standards of operation, noting that although the commercial companies in Emirates are government-owned, they separate ownership and administration. He emphasized that the government’s interference was required in order to "adjust the market and not to tame it."
Shaker said that the majority of Dubai’s foreign debt, worth approximately US$30 billion, belongs to British firms and banks.
Translated from the Arabic Edition.
