CAIRO (Reuters) - President Hosni Mubarak returned to Egypt on Saturday, landing in Sharm El Sheikh where he will reassume presidential powers while recovering from gallbladder surgery in Germany, state television showed.

Live coverage showed the 81-year-old Mubarak descend from the door of the plane on an escalator and take measured steps as he shook hands with the government officials and military officers there to greet him after three weeks away, his longest absence over nearly three-decades in power.

"President Hosni Mubarak has arrived at Sharm El Sheikh international airport after a successful medical trip," a state television anchor said.

Mubarak, who handed over presidential powers just before his operation to Prime Minister Ahmed Nazif, will reassume them upon arriving in Egypt, a government official said.

Mubarak's absence unsettled local financial markets and fuelled political uncertainty as Egyptians were reminded that the president, who has been in power since 1981, has not named a successor.

Egypt's stock market fell sharply in the days after the president's March 6 operation to remove benign tissue, before steadying when images of him sitting and chatting with doctors were broadcast.

SUCCESSOR

"Egypt is witnessing a period of instability and the president's absence, especially for health reasons and surgery, has heightened people's worries," Abdel Aziz Husseini, spokesman for the protest movement Kefaya, told Reuters.

Mubarak has not said whether he plans to run for a sixth six-year term in a presidential election due in 2011. His 46-year-old son Gamal has been widely touted as a successor, but father and son have both denied there are any such plans.

"The question is what will happen now that Mubarak has returned. Will he finally assign a vice president following an absence for health reasons?" said self-exiled political analyst Saad Eddin Ibrahim, who urged the president "to give Egyptians some measure of certainty".

Other possible presidential candidates include former U.N. nuclear watchdog chief Mohamed ElBaradei, who in his first public appearance since returning to Egypt last month was met by supporters chanting "Your are our hope" at Friday prayers.

Markus Buechler, Mubarak's German doctor at Heidelberg University Hospital, said in a statement the president has recovered from surgery but needed further rest.

"The president has fully recovered ... I have recommended however that the president continues his convalescence back home during the coming two weeks before he gradually returns to full and normal activity."

Parliament speaker Fathi Sorour and Defence Minister Mohamed Hussein Tantawi were among several officials receiving Mubarak. Ahmed El-Tayeb, head of al-Azhar, Egypt's seat of Islamic learning, and Pope Shenouda III, the country's highest Christian authority, were also present.

The president was accompanied by his wife Suzanne Mubarak and his two sons Alaa and Gamal. The family climbed into a vehicle after greeting officials.