Following the overthrow of Zine el-Abidine Ben Ali’s government in Tunisia, attention has turned to regimes with similar characteristics in the region.
Investors in Egypt are nervous. The Cairo bourse’s benchmark index fell by around 6% in the week following Mr Ben Ali’s departure, with foreign investors particularly heavy sellers. The Egyptian pound and credit default swaps on government debt have also come under pressure this week.
Bargain hunters edged back into the stock market today, driving a modest rally. This, and recent commitments from large companies to boost direct investment in Egypt, suggests that the recent turmoil is a “a re-rating of assets instead of a fundamental reassessment of exposure to the country”, according to a story over at the parent site.