Market Report: Egypt's Bourse enters the red after series of gains

Marwa Hussein, Wednesday 15 Jun 2011

Today's fall is seen by analysts as a normal correction following a 15 per cent rise in stock values since May

Egyptian Stock Exchange
A view shows the Egyptian Stock Exchange in Cairo, June 13, 2011. REUTERS (Photo: Reuters)

Egypt's stock market reversed its northern direction in today's session with the EGX30 index falling 0.94 per cent to record 5,560.54 points.

Analysts see today's fall as normal after several upward sessions. "The market rose by nearly 15 per cent since May, no market will increase by such an amount every month, it is normal that there will be correction or profit taking," said Walaa Hazem, an asset manager at HC securities.

"Trading volume is still quiet limited, so any selling of big shares affects the market even if just a small amount," explains Mostapha Badra, chief executive officer of EAC Holding.

In fact, the highest market capitalisation companies, the most influencial on the market's direction, all witnessed a fall. Orascom Construction Industries' (OCI) stock, the biggest fish in the Egyptian market, witnessed a 2.21 per cent fall.

Other important shares such as Orascom Telecom Holding (OT), Telecom Egypt and Commercial International Bank were all in the red by the end of the day's trading.

EFG-Hermes, Egypt's biggest investment bank, witnessed a slight fall of 0.50 per cent after it announced earlier in the day its first quarter net profit had slumped 93 per cent. For Hazem, the announcement has little to do with the fall in the bank's share value.

All in all, ten sectors went in the red today while only three made gains. Five sectors remained unchanged. The market's total turnover was LE495 million ($83.3 million), half of its averages before closing during the revolution.

Foreign traders shifted their strategy from buyers to sellers to close the session as net sellers, while Egyptian and Arab traders were net buyers.

The broader EGX70 index witnessed a very slight fall of 0.03 per cent.

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