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Market Report: Egyptian bourse dips on Tahrir violence

Political tensions bring a subdued day of trading with losses in all but two sectors

Ahram Online, Sunday 10 Apr 2011
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(Photo: Reuters)
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Egypt's benchmark stock index dipped 1.42 per cent to reach 5,349 points on Sunday amid heightened political tensions, marking the Bourse's sixth consecutive day of modest losses.

Sunday was the first day of trading since mass protests across Egypt on Friday and a fatal military crackdown on protesters occupying Cairo's central Tahrir Square early yesterday morning.

"What we're seeing in the market is clearly because of political tensions following the Tahrir events and clashes between protesters and the army," says Salah Heider, a financial analyst at Citytrade Securities.

"Delays in the release of some year-end company earnings may have made things worse, but most profit reports were already available and trade based on them took place in the last three days of last week. [The dip] seems directly related to Tahrir."

The Bourse declined across practically all sectors, with broader stock indexes, the EGX70 and EXG100, dipping 1.05 per cent and 1.21 per cent respectively.

Of 182 listed stocks, 146 dipped in value and 32 rose, with four remaining stable in a day that saw LE379,185,136 change hands.

Food and beverages and pharmaceuticals bucked the downward trend as the only sectors seeing gains. In both, solid gains for larger firms parried other losses.

Top market gainers and losers were both in the constructions and materials sector, a slice that accounted for 23 per cent of Sunday's total market capitalisation.

Egyptian for Developing Building Materials finished 8.78 per cent up while Arab Ceramics dropped 10 per cent. Sinai Cement was down 9.69 per cent.

Political considerations helped stocks on one occasion, when shares in Cairo-based equity firm Citadel Capital edged up 1.22 per cent after Saturday's declaration from owner Ahmed Hekal that there are no business connections between Gamal Mubarak and the company.

Egyptians were again the majority of trades, making up 64.3 per cent, and were the only net-buyers, spending a net value of just over LE13 million.

Foreign involvement continued its return to Mubarak-era levels, with non-Arabs comprising 31 per cent of trade and being net sellers.

"The proportion of foreigners is becoming like in the pre-revolution era when their participation used to represent a quarter of the market," says Heider.

Individual traders, whose market share has rallied in the past week, made up 59 per cent of Sunday trade. Though such traders often focus on lower-cap firms outwith the EGX30, the broader indexes still dropped.

"The EGX70 declined in spite of the fact that individuals were net-buyers because the shares they ended up buying had less value than those they sold," explained Heider.

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