Egypt’s stock market on Sunday surged into the green for the fifth consecutive day amid expectations of good corporate third-quarter results and as a positive political outlook for Egypt boosted investor confidence.
The benchmark EGX 30 index rose 1.49 per cent for the day to close at 4,214 points, surpassing the index's level as of the beginning of October. The broader EGX70 stock index gained 1.93 points, meanwhile, to close the day at 483 points.
“The market is reacting positively to the start of the election process, which has been smooth and unproblematic,” said market expert Mostafa Badra.
Candidacy registration for Egypt’s first post-Mubarak parliamentary polls officially began last week amid positive media coverage.
“Companies are also scheduled to announce their third-quarter results, which are expected to be positive for certain sectors,” Badra said. “So investors are buying now to capitalise on possible profits.”
He went on to explain that companies such as Orascom Construction Industries (OCI), along with certain cement firms, were expected to post favourable third-quarter results.
Market turnover, meanwhile, fell on Sunday to LE203 million ($33.8 million) after having swelled to LE413.9 million on Thursday due to large cross-trading volumes on big caps, which was not the case in today’s session.
Talaat Mostafa Group, Commercial International Bank and Orascom Telecom together accounted for 20 per cent of Sunday’s trading, gaining in value by 1.73, 0.72 and 1.24 per cent respectively.
Telecom Egypt (TE), the market’s second-largest listed company in terms of capitalisation, saw its share price rise by 0.67 per cent to close the day at LE14.97, despite news of a looming companywide strike that might halt Egypt’s landline and Internet services.
TE workers demand the resignation of the company’s CEO and board of directors, whom they accuse of corruption and of causing financial losses to the company.
The strikes have already reportedly affected the company’s telephone directory services in Cairo and Alexandria, along with Aswan’s main telephone centre.
In a press release issued Sunday morning, the company – which provides 70 per cent of Internet service in Egypt and is the country’s sole provider of land telephone service – said that work was progressing “as usual.” Company officials went on to stress that no workers’ strikes were currently taking place.
Individuals accounted for 75 per cent of Sunday’s stock trading. Foreigners also had a higher-than-usual share, accounting for 15 per cent of the market, net-buying at LE7.2 million. “A high level of market participation by foreigners is a positive sign of recovery,” Badra said.
Out of 188 company stocks traded in today’s session, 143 finished up and 28 lost value.
Alexandria Mineral Oil Company was one of the most prominent gainers, rising by 6.34 per cent to close the day at LE61.22 on the back of positive financial results. Today the company announced 87 per cent annual growth for the third quarter, while net profits for the period stood at LE383 million.
Six of October Development & Investment, meanwhile, also rose by 6.86 per cent. The rise comes following the company’s announcement that its approximated total sales had reached LE570 million in the first nine months of the year, compared to total revenues of only LE198 million for the same period last year.