Egypt stocks end Sunday up despite ongoing political impasse
EGX30 rises 1.81 per cent despite ongoing political turmoil; Analysts fear calls for 'civil disobedience' this week could scare off already-skittish investors
Karim Hafez, Sunday 2 Dec 2012
File photo: workers at Egypt's stock exchange market are seen in the trading hall in Cairo (Photo: AP)
Egyptian stocks saw slight gains on Sunday, loosely coinciding with a call by President Mohamed Morsi to put Egypt's draft constitution before a nationwide referendum on 15 December.
The benchmark EGX30 index rose by 1.81 per cent, closing the day out at 4,894 points. The broader-based EGX70 index also rose slightly, finishing Sunday up by 1.2 per cent.
Of 165 shares traded, 116 registered gains while only 24 lost value, following two weeks of political turbulence that has led to significant losses.
"The Egyptian stock market has witnessed disastrous losses, reflecting ongoing political turmoil; today's modest gains cannot yet be considered a recovery," said Ashraf Abdel-Aziz, head of institutional sales at Cairo-based brokerage Arabeya Online.
Some analysts believe the market is likely to witness further losses, given that the current political crisis remains far from resolved.
Trade volume continued its freefall, meanwhile, standing at a mere LE211 million on Sunday, highlighting investors' continued nervousness vis-à-vis the Egyptian market and accompanying uncertainty over the ongoing political impasse.
"Trade volumes are continuing to fall. This is not a good indicator," said capital markets expert Mostafa Badra. "Today's gains, meanwhile, which followed on from the slight rises seen Thursday, were not particularly impressive."
Next Tuesday's call for a campaign of civil disobedience by political factions opposed to the president will likely lead the stock market to fall further and further decrease trade volumes, say analysts.
"The calls for civil disobedience next Tuesday are only adding to the general atmosphere of uncertainty among investors," Badra explained.
Eleven Egyptian publications have decided not to print their Tuesday editions to protest a controversial decree issued by Morsi last month that makes his decisions impervious to judicial challenge. A handful of private satellite channels also reportedly plan to temporarily cease transmission on Tuesday.
Orascom Construction Industries (OCI), Egypt's largest publicly traded company, rose by 4.1 per cent in Sunday trading. Market analysts attribute the rise to OCI's expected demerger, as the company is currently finalising the process with the Egyptian Financial Supervisory Authority.
Egypt's telecom sector in general performed poorly on Sunday, with both Orascom Telecom Holding (OTH) and Telecom Egypt tumbling by 0.29 and 0.24 per cent respectively.