Gold mining in Egypt dates back to pre-dynastic times – way before 3,100BC. Miner Centamin Egypt's experience is a little more recent – it began working its flagship Sukari gold mine in 2009.
But yesterday it struck disaster, not more gold. A court ruling in the north African country was followed by it temporarily suspending its shares at 10am. Perhaps a little late – shares had already crashed more than 50 per cent. A judge ruled Centamin's contract to explore the Sukari mine was void and a decision by the authorities to offer a 30-year contract and let it be renewed was also void.
The mine in question, in the Eastern Desert about 700km from Cairo and 25km inland from the Red Sea, had only just hosted an analyst meeting.
Centamin owns it in a joint venture with the Egyptian government. It played down the court's decision and said in a statement that it "notes media reports … that its Concession Agreement to extract gold from the Sukari mine has been annulled," and added: "Comments reportedly made by an Egyptian administrative court have given rise to speculation that parts of the Concession Agreement may have, in fact, been suspended. However, at this time, no details of a final decision are available and no written judgment has been given."
It is the latest foreign company to be hit by court action over contracts signed with Hosni Mubarak's regime.
The mine remains operational, and is one of a number of mines owned by the group in Africa, but its shares slumped 34.9p to 63.82p and it remains temporarily suspended. Some traders speculated that the shares could sink as low as 15p when it comes back to the market.
Sandy has left devastation in its wake but City analysts think insurers could avoid much of the turbulence. Estimates are industry-insured losses will be up to $10bn once the superstorm finishes its exertions.
Oriel Securities put this into context: 2011's Hurricane Irene created industry losses of between $6bn and $7bn.
Oriel's Marcus Barnard and Hari Sivakumaran think the industry will be able to absorb these losses, "even if this initial estimate proves to be too low, and revised upwards".
They retain their buy recommendation for insurer Catlin and an add for Hiscox. The two mid-cap index insurers recovered some of the previous day's falls. Catlin managed a 6.8p rise to 471.8p and Hiscox recovered 2.7p to 479.2p. Sandy might not wreak as much damage on insurers as some feared but London's trading floors were deathly quiet with volumes down because of New York's closure. Wall Street was shut for a second day but the benchmark FTSE 100 index recovered the previous day's losses and put on 54.8 points to 5,849.9.
Traders in London with less to do because the US was shut, had time to gossip about France's luxury goods groups.
One trader speculated that Bernard Arnault – the man behind listed luxury goods groups Christian Dior and LVMH – is on the expansion march again. His investment arm L Capital – part owned by LVMH – recently hired JP Morgan to flog its high street fashion brands including Maje and Sandro for up to £500m for it to concentrate on more high-end brands. Rumours from some quarters in the City suggested Arnault has looked at British brand Burberry but it is now not pursuing this. The Arnault family own around 70.4 per cent in Christian Dior via direct and indirect holdings and Christian Dior owns 49.9 per cent of LVMH. City gossips think Arnault plans to up his stake in Dior – shares that are better value at the moment than many other luxury goods businesses.
LVMH shares sashayed up €1.95 to €126.75 while Christian Dior strutted up €2.1 to €109.8. Burberry gained 17p to 1,180p.
Staying on the rumour theme, the potential takeover of publisher and events business Informa was still being touted as likely, with Germany's Axel Springer and a private equity bidder still mooted. It edged up 2.8p to 395.6p.
Today is the deadline for the merger to be confirmed of soft drinks groups AG Barr and Britvic. The shares fizzed up 3.1p to 448p and 1.4p to 360p respectively.
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