Last Update 0:5
Wednesday, 16 October 2019

Market Report: Egypt Bourse gains on minister's vows

Main index claims 1.4 per cent as investors react positively to statements on funding and privatisation from the recently appointed finance minister

Ahram Online, Sunday 2 Oct 2011
Egypt
(Photo: AP)
Share/Bookmark
Views: 1623
Share/Bookmark
Views: 1623

Egypt's Bourse finished October's first trading session in the green after the Minister of Finance rang the opening bell and made statements that soothed investors.

The market's main benchmark, the EGX30, gained 1.37 per cent to close at 4,193 points, while the broader EGX70 climbed 3.03 per cent.

The newly established EGX20 index also finished in the green, climbing 1.26 per cent in its very first day of trading.

"El-Beblawi's visit gave assurances to investors about many critical issues, namely liquidity and the free market," said Mostafa Badra, a capital markets expert.

Egypt's finance minister, Hazem El-Beblawi announced during his visit to the Bourse that the government was attempting to reduce its dependence on borrowing from local banks due to the burden it puts on the economy.

"Rising yields on treasury bills have lured banks and financial institutions away from the stock market," Badra said. "Why invest in a risky stock market when they can lend the government at equal or sometimes higher rates of return?"

Beblawi's statement, along with earlier ones suggesting the government is brokering a deal for Arab governments to invest in Egypt's treasury bills, contributed to give investors the impression that liquid financial institutions might yet make a strong return to the market.

El-Beblawi also reiterated the government's commitment to the market economy, saying that the cabinet would challenge rulings by the courts that have overturned deals already agreed to privatise state assets.

As for government support for the stock exchange, El-Beblawi indicated that such support is done through applying proper financial and economical policies, and not through direct support from government owned -- and non-listed -- banks.

From a total of 174 shares traded today, 148 gained while 22 dropped, while trade totalling LE236.8 million (US$39 m) in turnover.

Citadel Capital comprised more than quarter of trading, at around LE60.7 million, climbing 1.39 per cent to close at LE3.64 per share.

"The high trading on Citadel is attributed to cross trading to transfer stock ownership," Badra explained.

Orascom Construction Industries (OCI), the exchange's biggest stock, rose a significant 1.74 per cent to close at LE216.63 per share, carrying the entire EGX30 upwards.

Renewed workers' strikes seemed to have little effect on stock performance.

Arab Polvara Spinning and Weaving gained 2.13 per cent ignoring news of more than 4,000 workers striking and protesting demanding that the privatized company returns to public ownership along with other compensation demands.

Other big caps, such as Orascom Telecom, Abou Kir Fertilizers and TMG Holding grew 0.90, 4.01 and 2.44 per cent, respectively.

Maridive also grew 2.69 per cent disregarding a protest by 60 workers at its contractor SUMED terminal for financial demands as well.

EFG Hermes, one of Egypt's top financial bodies gained 0.6 per cent to close at LE16.84 per share. 

The investment bank denied on Sunday rumours that its chief executive Yasser El-Mallawany had fled Egypt, saying he is present at company headquarters in Cairo and carrying out his normal duties.

Rumours circulated over the weekend on social media site Twitter, claiming El-Mallawany had fled Egypt following the airing of a TV programme that linked him to the controversial business activities of Gamal Mubarak.

Foreign investors comprised 24 per cent of trading, a higher than average outing for Sunday, net-selling at LE59.8 million. Arabs also contributed to a high 14.7 per cent of trading and were the main buyers, hitting the LE51 million mark.

Egyptians made up 61.19 per cent of trading and were net buyers.

"The high trading volume from Arabs and foreigners is definitely a positive indicator, and may be attributed to improvements in global stocks," Badra said.

 

 

Short link:

 

Email
 
Name
 
Comment's
Title
 
Comment
Ahram Online welcomes readers' comments on all issues covered by the site, along with any criticisms and/or corrections. Readers are asked to limit their feedback to a maximum of 1000 characters (roughly 200 words). All comments/criticisms will, however, be subject to the following code
  • We will not publish comments which contain rude or abusive language, libelous statements, slander and personal attacks against any person/s.
  • We will not publish comments which contain racist remarks or any kind of racial or religious incitement against any group of people, in Egypt or outside it.
  • We welcome criticism of our reports and articles but we will not publish personal attacks, slander or fabrications directed against our reporters and contributing writers.
  • We reserve the right to correct, when at all possible, obvious errors in spelling and grammar. However, due to time and staffing constraints such corrections will not be made across the board or on a regular basis.
Latest

© 2010 Ahram Online.