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Fears of anti-Morsi protests send Egypt stocks to one-year low

Bearish investors send Egyptian stocks to one-year low on fears of ongoing political instability caused by protests on Morsi anniversary

Ahram Online , Wednesday 12 Jun 2013
stock exchange
The Egyptian Exchange bell is seen at the stock exchange in Cairo (Photo: Reuters)
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Egyptian stocks plunged to a one-year low on Wednesday on fears of political instability caused by anti-government protests scheduled for 30 June, the anniversary of President Mohamed Morsi's inauguration.

The main EGX30 index tumbled 5.1 percent to 4,598 points under the impact of heavy selling by Egyptian investors (LE98.2 million.)

Foreign investors ended the session as net-buyers (LE70 million) as they took advantage of low prices to buy up blue-chip shares.

The broader EGX70 index remained at its lowest level since its launch in 2009, dropping by 4.5 percent to 352.4 points.

If the main index witnesses similar falls (more than 5 percent) on Thursday, trading will be suspended under market rules.

Several listed stocks were suspended by midday trading on Wednesday because they fell by more than 5 percent.

Market bellwethers Commercial International Bank and Orascom Construction Industries slipped 4.8 percent and 2.7 percent to close at LE30.9 per share and LE227.6 per share respectively.

Telecommunication giant Orascom Telecom fell 7 percent and Egypt's biggest investment bank EFG-Hermes declined 4 percent.

Property shares all slumped, led by Talaat Mostafa Group (6.2 percent), Palm Hills (8.4 percent) and Six of October Development and Investment (9 percent).

Reuters reported on Wednesday that MSCI, the most widely used equity index provider, had prompted market fears about both Greece and Egypt, after it demoted the former and raised concerns about getting hard currency out of the latter.

MSCI redesignated Greece an emerging market late on Tuesday, 12 years after its promotion from the category, assigning it a tiny 0.3 percent weighting - far less than it had when it was last in the emerging index category.

In a follow-up conference call on Wednesday, an MSCI official then triggered worries about Egypt when he said the firm had had reports of investors having difficulties when repatriating money out of Egypt.  

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