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Market Report: EGX30 drops 3.4 per cent as business heads feel the heat

Resignations, detentions and an unexpected death prompt largest Bourse fall in two weeks

Bassem Abou El-Abass, Sunday 17 Apr 2011
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Egypt's main stock index the EGX30 closed down 3.4 per cent at 5,115 points after major listed firms took hits on the back of the weekend's political developments.

All sectors suffered losses with the exception of pharmaceuticals and healthcare. Of 181 listed stocks, 138 declined and 33 gained in a day in which LE 413.776 million change hands.

"As usual, a 'dry' Sunday was coupled with very low volumes [of trade]. Consecutive bad news also impacted negatively on today's market," says Omar Darwish, an equity trader with CI Capital.

Several prominent firms shed value on Sunday following unfavourable news about their owners or officials.

The Asek Company for Mining reversed two weeks in the 'top gainers' list to decline 7.3 per cent.

"Financial shares were the worst performers, with the exception of Naeem Holding whose stock increased 2.33 per cent after the approval of a 5 per cent divided per share," says Darwish.

Stock in Citadel Capital plunged 10 per cent after Egypt's public prosecutor ordered that the bank's head, Ahmed Heikal, be banned from travel pending a probe of corruption allegations.

EFG Hermes dropped 5.7 per cent after the resignation of a board member and head of the brokerage Sherif Cararah.

Shares in Egypt Kuwait Holding fell 8.2 per cent after the death of chariman Nasser Al-Kharafi, the Kuwaiti magnate and billionaire, who died on Saturday night in Cairo.

Egyptian for Tourism Resorts continued its plunge, with a 9.4 per cent drop on Sunday following heavy losses at the end of last week.

On Sunday the company announced it had removed Ibrahim Kamel, a senior member of Mubarak's NDP from its board, without citing a reason. Kamel was detained last week on accusations of orchestrating fatal attacks on protesters in Cairo's Tahrir Square.

Foreigners and Arabs were net buyers with LE5,820m and LE1,205m respectively. Egyptians were net-sellers to the tune of LE7.026m.

The broader EGX70 and EGX100 fell 2.1 per cent and 2.5 per cent.

Heavy-weighted shares all sank on Sunday, with Ezz Steel dropping 4.9 per cent, Orascom Construction Industries (OCI) 3.6 per cent and Orascom Telecom (OT) 1.1 per cent.

"OT declined in spite of positive news about VimpelCom completing its merger with Wind Telecom [owned by OT] which the market was not able to digest," says Darwish.

Cement shares were affected by the decline of the construction sector, with Sinai, Torah, Suez and Alexandria dipping by 2.8, 0.03, 1.06 and 0.6 per cent respectively.

Real estate firms Palm Hills Development, TMG and SODIC are still struggling to regain investor confidence, losing 7.6 per cent, 5.1 per cent and 6.8 per cent respectively.

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