Egypt's bourse sees sharpest rise in weeks as foreigners buy back into blue chips

Ahram Online, Tuesday 21 Oct 2014

EGX30 rises 1.15 percent as rally from European shares, Gulf markets encourages foreign investors to buy into low-priced Egyptian blue chips

Egyptian stock exchange
Traders work at the Egyptian stock exchange in Cairo (Photo: Reuters)

Egypt’s main index witnessed its biggest rally in three weeks on Tuesday, climbing 1.15 percent to close at 8,633 points.

Investors were cautious at the start of the session, but gains by European and regional markets encouraged them to buy back into the Egyptian market.

European shares were boosted on Tuesday after European Central Bank insiders told news agency Reuters the bank was planning to buy corporate bonds to fight a slow-down in the European economy.

"Investors took advantage of the low prices of blue chips, some which lost as much as 15 percent of their value after the aggressive sell-off witnessed in past sessions,” Mohamed Radwan, head of equities at Pharos Holding, told Ahram Online.

Non-Arab foreigners, who accounted for 25 percent of market activity, were net-buyers for LE30.9 million worth of shares, while Arab investors, representing nearly 12 percent of the market, bought a net LE21.6 million as local investors were net-sellers.

Total turnover for the session was modest, at LE562 million.

Market bellwether Commercial International Bank (CIB) rose 0.80 percent to close at LE45.30.

Cairo-based investment bank EFG-Hermes climbed 1.03 percent to LE15.69.

Real estate shares were also in the green, with TMG Holding gaining 1.77 percent to trade at LE9.77, Six of October Development and Investment (SODIC) leaping 2.56 percent to trade at LE14.41 and Palm Hills Development Company rising 2.94 percent to close at LE3.85.

Global Telecom Holding rose 1.46 percent to LE 4.18, while majority state-owned Telecom Egypt was up 0.72 percent to LE12.54.

The broader EGX70 index rose 1.71 percent.

Gulf markets rebounded on Tuesday, with Abu Dhabi rising 0.53 percent, Dubai leaping 3.49 percent and Saudi Arabia gaining 2.39 after Brent prices rose and held near $86 a barrel on Tuesday.

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