Market Report: Egypt shares still shaken

Ahram Online, Tuesday 13 Sep 2011

Stocks tumble for the third consecutive day, losing 1.6 per cent as selling pressures build and overseas investors trade in more of their high-cap holdings

Worrying times at the Egyptian Bourse (Photo: AP)

Egyptian stocks tumbled for their third consecutive session on Tuesday as overseas investors bailed from the market as unease over  the weekend's protests and storming of the Israeli embassy in Cairo rumbled on.

The benchmark EGX30 closed down 1.62 per cent at 4,538.6 points with Arab and other foreign investors sold mainly high-cap stock. The day's dip brought the losses of the index to 4.5 per cent since the start of the trading week.
"Any kind of clashes negatively affect the market and worry investors," said Ashraf Abdel-Aziz, head of institutions sales at Arabia Online Securities. "In the general atmosphere of instability, the reaction to events can be felt for days." The threat of Egypt's much-reviled emergency law being applied was also said to be hurting buying sentiment.
Market turnover was LE286,558 (US$48,153), meagre when compared to pre-revolution levels but a marked improvement on Sunday when it dropped to some LE206 million, its lowest volume since 2004.
The instability of international markets, hobbled by the fear of a Greek default and consequent crisis for the euro zone, fed caution on the Egyptian Bourse, which saw the biggest losses of all the Middle East's stock exchanges.
From 177 listed stocks, 146 lost value and just 22 finished in the green with the broader EGX70 doing almost as poorly as the main index, falling 1.55 per cent.
Egyptians were net-buyers, picking up the net-sales of Arabs and foreigner traders which recorded LE14.7m and LE19.03m respectively. Institutions, which made up 64.2 per cent of trades, were also major sellers, with many focusing on the most heavy-duty stock.
Egypt's Commercial International Bank (CIB) saw Tuesday's most sustained trade -- around a tenth of total turnover -- and lost a hefty 2.66 per cent. 
In second place was the market's largest cap, Orascom Construction, which saw losses of a modest 0.51 per cent in a performance mirrored by other firms in the Orascom stable. Investment bank EFG Hermes was next, down a significantly higher 2.26 per cent.
Biggest losses, however, were felt by smaller firms like Tourism Urbanization, down 9.18 per cent. National Societe Generale Bank (NSGB) also slipped 3.32 per cent following an annoucement the bank will be cutting costs in its Egypt operations.
A smattering of news cushioned a few companies. Stocks in El Sewedy Electrics finished up 0.64 per cent as the region's major cablemarker said it expects to improve its performance during the second half of 2011 as demand for its products recovers.
But recent news of a capital increase for Maridiv wasn't enough to save the oil services firm from selling pressures, which sunk it 5.91 per cent into the red.
 "The downwards trend is the common trend those days and rebounds are exception," said Abdel Aziz. 
Another day of decline prompted despair from some commentators over the country's lack of focus.
"Things on the political level are not clear and not going in a constructive direction," said one trader who requested anonymity. "The political situation has a big influence and it seems that nobody cares about the economic situation."  
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