Egypt’s equities or its CDS spreads: which to trust? | beyondbrics

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Here’s a question: why are Egyptian equities and Egyptian CDS spreads moving in tandem? In normal circumstances, you’d expect them to move in mirror image of each other. If equities go up, you’d think investors were optimistic about the country’s prospects (good); if CDS spreads go up, you’d think they viewed default as increasingly likely (bad).

So if both go up, is that good or bad?"

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