Historic political shake-up of region encouraging financiers

Ceasefire anticipated to take pressure off Israel's financial resources

Major funds increasing positions in Egypt

Hopes for resolution of Lebanon's crisis increasing its bonds

(Recasts heading, adds emergency situation Arab top in paragraph 8)

By Marc Jones and Steven Scheer

LONDON/JERUSALEM, Feb 9 (Reuters) - A historic shake-up of the Middle East is beginning to draw global investors, warming to the potential customers of relative peace and financial recovery after so much chaos.

President Donald Trump's proposal that the U.S. take over Gaza may have tossed a curveball into the mix, but the delicate ceasefire in the Israel-Hamas war, Bashar al-Assad's ouster from Syria, a weakened Iran and a new federal government in Lebanon have fed hopes of a reset.

Egypt, the area's most populous country and animeportal.cl a crucial negotiator in the current peace talks, has simply handled its first dollar financial obligation sale in 4 years. Not too long ago it was facing financial crisis.

Investors have actually started buying up Israel's bonds again, and those of Lebanon, wagering that Beirut can lastly begin repairing its linked political, economic and financial crises.

"The last couple of months have very much reshaped the region and set in play an extremely different dynamic in a best-case situation," Charlie Robertson, a veteran emerging market analyst at FIM Partners, said.

The concern is whether Trump's strategy for Gaza inflames stress again, he added.

Trump's call to "clear out" Gaza and develop a "Riviera of the Middle East" in the enclave was fulfilled with international condemnation.

Reacting to the outcry, Egypt said on Sunday it would host an emergency situation Arab summit on February 27 to discuss what it explained as "serious" advancements for Palestinians.

Credit ranking company S&P Global has actually indicated it will eliminate Israel's downgrade caution if the ceasefire lasts. It acknowledges the complexities, however it is a welcome possibility as Israel prepares its first major financial obligation sale given that the truce was signed.

(UN)PREDICTABILITY

Michael Fertik, a U.S. endeavor capitalist and pl.velo.wiki CEO of expert system company Modelcode.ai, said the easing of tensions had contributed to his choice to open an Israeli subsidiary.

He aspires to employ competent regional software developers, but geopolitics have been an element too.

"With Trump in the White House, no one questions the United States has Israel ´ s back in a fight," he said, explaining how it offered predictability even if the war re-ignites.

Having mainly remained away when Israel ramped up costs on the war, thatswhathappened.wiki bond investors are likewise starting to come back, main bank data shows.

Economy Minister Nir Barkat told Reuters in an interview last month that he will be seeking a more generous costs package concentrating on "strong financial development."

The snag for stock investors though, is that Israel was one of the best carrying out markets in the world in the 18 months after the October 7, pipewiki.org 2023 attacks. Since the ceasefire - which has accompanied a substantial U.S. tech selloff - it has actually remained in retreat.

"During 2024, I believe we learned that the marketplace is not truly afraid of the war however rather the internal political dispute and tensions," said Sabina Levy, head of research at Leader Capital Markets in Tel Aviv.

And if the ceasefire ? "It is reasonable to presume a negative response."

Some financiers have actually already responded terribly to Trump's surprise Gaza relocation.

Yerlan Syzdykov, head of emerging markets at Europe's most significant possession manager Amundi, said his company had purchased up Egypt's bonds after the ceasefire offer, but Trump's strategy - which visualizes Cairo and Jordan accepting 2 million Palestinian refugees - has altered that.

Both nations have actually baulked at Trump's idea however the threat is, Syzdykov explained, that the U.S. president uses Egypt's dependence on bilateral and IMF support to attempt to strong arm the country given its recent brush with a full-blown financial crisis.

Reducing the attacks by Yemen's Houthi fighters on ships in the Red Sea likewise remains essential. The country lost $7 billion - more than 60% - of its Suez Canal profits in 2015 as carriers diverted around Africa rather than risk ambush.

"Markets are not likely to like the concept of Egypt losing such (bilateral and multilateral) support, and we are taking a more careful stance to see how these negotiations will unfold," Syzdykov said.

REBUILD AND RESTRUCTURE

Others anticipate the rebuilding of bombed homes and infrastructure in Syria and galgbtqhistoryproject.org in other places to be a chance for Turkey's heavyweight building firms.

Trump's Middle East envoy, Steve Witkoff, has said it could take 10 to 15 years to rebuild Gaza. The World Bank, meanwhile, puts Lebanon's damage at $8.5 billion, approximately 35% of its GDP.

Beirut's default-stricken bonds more than doubled in cost when it became clear in September that Hezbollah's grip in Lebanon was being compromised and have continued to increase on hopes the country's crisis is resolved.

Lebanon's brand-new President Michel Aoun's first state check out will be to Saudi Arabia, a country viewed as a possible key supporter, and one that most likely sees this as an opportunity to more eliminate Lebanon from Iran's sphere of influence.

Bondholders say there have actually been initial contacts with the new authorities too.

"Lebanon could be a huge story in 2025 if we make development towards a financial obligation restructuring," Magda Branet, head of emerging markets repaired income at AXA Investment Managers, said.

"It is not going to be simple" though she added, provided the nation's track record, the $45 billion of financial obligation that requires reworking which Lebanese savers might see some of their money taken by the federal government as part of the strategy.

(Reporting by Marc Jones and Steve Scheer; Editing by Sharon Singleton and William Mallard)