Egypt and the MSCI: a patriotic reprieve? | beyondbrics – FT.com

As widely predicted, circuit breakers were triggered within moments of the resumption of trading on the Cairo stock exchange on Wednesday. As beyondbrics reported on Tuesday, any sustained interruption could result in Egyptian stocks being expelled from the benchmark MSCIEmerging Market Index.

But things didn’t go as badly as they might have. By the close, the 100 share index was down 8.95 per cent – bad, but not a bloodbath. Crucially, circuit breakers were only triggered the once. If trading continues like this over coming days, Cairo could win a reprieve. And it might owe its salvation to a surge of popular patriotism.

There is little empirical evidence for this so far, but the anecdotal evidence is strong. There was a massive public relations campaign in Egypt to support the stock market’s re-opening including this appeal from Essam Sharaf, interim prime minister.