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Egypt's stocks drop, then rebound, after Mansoura deadly blast

Egypt's Bourse rebounds following a tremulous beginning as a deadly blast early Tuesday rocked the Nile Delta city of Mansoura

Ahram Online, Tuesday 24 Dec 2013
Exchange
Traders work at the Egyptian Stock Exchange in Cairo (Photo: Reuters)
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The Egyptian bourse saw a tremulous beginning for Tuesday's session against the background of a deadly blast that rocked the city of Mansoura in the early hours of the day.

Egypt's benchmark index EGX 30 hit a session's bottom of 6654.28 points at 10:50am, which represents a 1.06 percent drop from the session's opening 6725.41 points.

By 12:15pm, however, the index had already begun surpassing the session's starting point with a 0.05 percent rise.

"Although the Mansoura events had a direct impact on the market this morning, I can see the market rebounding already," Issa Fathy told Ahram Online in a phone interview.

In the early hours of Tuesday morning, a deadly bombing in the Nile Delta's Daqahliya Governorate hit the city of Mansoura's Security Directorate.

The blast killed 13 and injured 134 in what appears to be the worst terrorist attack on a government site since the July ouster of Islamist president Mohamed Morsi.

The explosion ripped through the building's side façade and damaged a number of police vehicles and parts of adjacent buildings which include the city's council building, a state-owned theatre and a bank.

"Stock markets are mainly affected by expectations, and I believe the relatively low impact of the event can be related to the existing expectations of terrorist attacks," Fathy said.

The government decision to consider the Muslim Brotherhood a terrorist organisation would ultimately positively influence the market, he added.

Cabinet Spokesman Sherif Shawqi had earlier blamed the blast on the Muslim Brotherhood group, to which ousted Islamist president Morsi is affiliated, and said Prime Minister Hazem El-Beblawi had officially declared the group a terrorist organisation.

However, Beblawi refused to confirm that Egypt had designated the Muslim Brotherhood a terrorist group, contradicting an earlier statement by one of his aides.

Non-Arab foreign investors are so far net buyers, purchasing a value of almost LE11 million at the session's low prices.

Ezz Steel share price fell to a low LE14.95 per share, but so far rebounded to LE15.25 per share while the Commercial International Bank share price inched down to LE32 per share and so far rebounded to LE32.61 per share.

Orascom Development Holding's lowest was LE6.33 ($0.92) per share but has so far rebounded to LE6.5 per share.

The broader index EGX 70 also witnessed a drop in its value to 528 points at 11.05am, but rebounded to 530 points at 11.45am.

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