Investors panic, foreigners sell in Egypt's market after plane vanishes

Ahram Online , Thursday 19 May 2016

The Egyptian Exchange bell is seen at the stock exchange in Cairo, in this April 1, 2013 (Reuters)
The Egyptian Exchange bell is seen at the stock exchange in Cairo, in this April 1, 2013 (Reuters)

Egypt's stocks plunged on Thursday after an EgyptAir plane went missing, causing investors to panic, analysts told Ahram Online.

Benchmark index EGX30 dipped 1.8 percent to register 7,499 points and daily stock turnover reached EGP 542 million.

"The plane accident had a negative impact on the market after it had rebounded from earlier losses mid week," Wael Enaba, board member at the Egyptian Association for Securities, told Ahram Online.

An EgyptAir flight vanished early this morning en route from Paris to Cairo. The plane's debris was later found south of the Greek island of Karpathos in the southern Mediterranean, according to Greek State TV.

The possibility of the incident being a terrorist attack raised fears over the possible impact on tourism and ultimately the economy, similar to when the Russian plane was downed last year, said Enaba.

The downing of a Russian plane in October had caused tourism, a main source of foreign currency, to drop, prompting a downward trend for Egypt's growth.

The drop in the main index "was driven mainly by uncalled for panic by investors, but also others who were making profits from the last few sessions’ gains," market expert Moustafa Badra told Ahram Online earlier on Thursday.

Non-Arab foreign investors were net sellers in the session at a net value of EGP 35.3 million.

Egyptian for Tourism Resorts saw the largest decline in the main index, falling 3.41 percent to EGP 0.85 a share. 

Blue chip Commercial International Bank (CIB) declined 2.46 percent to EGP 43.65 a share.

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