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Egypt's stocks tumble on investor worries over high-profile corruption case

EGX30, EGX70 fall as corruption charges against minister stir market fear

Ahram Online , Tuesday 8 Sep 2015
Egyptian stock market
An interior view of the Egyptian stock market is seen in Cairo (Photo: Reuters)
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Egypt's bourse fell Tuesday as investors worry that an investigation into corruption charges against key government officials could negatively affect the country's investment environment.

Agriculture Minister Salah Helal was arrested Monday on corruption charges and has been detained pending investigation.

Leading anti-corruption activist and former MP Hamdi El-Fakharany was also arrested on Sunday and is being investigated on charges of bribery.

Egypt's benchmark EGX30 index fell by 3.38 percent to 6,924 points on Tuesday, while the broader-based EGX70 declined by 3.49 percent.

"There are speculations that the high-profile corruption case that was recently unveiled could include big names both within the private sector and the government, which will stir distrust in Egypt's market," Mohamed Radwan, the head of equities at Pharos Holding, told Ahram Online.

Out of 166 stocks traded, 124 suffered losses while only 18 registered gains. Blue-chip stocks Orascom Construction Limited and the Commercial International Bank (CIB) both tumbled by 4.68 percent and 3.02 percent respectively.

Arab investors, meanwhile, were net sellers, offloading almost LE24 million worth of shares.

The real estate sector suffered the most, with market giants Talaat Mostafa Group Holding and Emaar Misr for development both declining by 6.10 per cent and 1.48 per cent respectively.                                                    

 

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2



Tut
08-09-2015 06:48pm
42-
4+
Fear of Corruption, really?
The whole Mubarak government was highly corrupt for 30 years and the market took it with no issue! Now a couple of guys are allegedly corrupt and the market falls!! It is a surprise the Egyptian stock market continues to exists with the economic and judicial state of the country!!
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Sam Enslow
08-09-2015 04:48pm
19-
3+
Corruption case will help market and economy and investors
The fact that Egypt is facing the problem of corruption will encourage investors and assist Egypt's economic recovery. When the fight is against low level corruption (sweets), it benefits the poor to whom LE 10 or 20 means a lot. For larger investors and businessmen, it means papers will move without bribes being paid every step of the way. The red tape is bad enough. Add corruption, and business becomes impossibly. Projects are often not started because of the requirements for bribes and partnerships. Money not going into the pockets of crooks can provide better living conditions for the poor and funds to be invested by that class. The reputation for being corrupt stops many from even thinking of investing in Egypt. Demands for sweets make the average Egyptian distrust promises of reform regardless of sincer efforts by the government to institute reforms. Corruption is a bigger threat than the Islamists - or equal to them.
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