Unrest in many regions across the country drove the market down 1.9 per cent on Sunday. “The drop is mainly a direct reflection of the turbulence Egypt is currently going through in Aswan and Damietta,” says Tarek El-Kafrawy, portfolio manager in CIBC Capital.

Large-scale clashes between protesters and police in Damietta governorate, north of Egypt, left two people dead and three injured on Sunday. Protestors angry at the government’s failure to relocate the controversial Agrium factory out of Damietta port were confronted by police in the latest wave of violence to hit Egypt.

Meanwhile, in the Aswan governorate, in southern Egypt, Police used tear gas to disperse protesters in the early hours of Sunday as they were demonstrating against police violence following the death of a boatman allegedly shot by a police officer last week.

“It’s not only that, but the mass protest planned for next Friday has added another stroke to Egypt’s portrait of instability,” El-Kafrawy added.

Broader indices followed Egypt's benchmark and sharply declined, with the EGX70 down 4.3 per cent, EGX100 down 3.5 per cent and EGX20 down 1.9 per cent.

“Along with the panic from the wave of violence in the country, some investors are selling to gain profits realised during the market growth of the past two weeks,” El-Kafrawy told Ahram Online.

Egyptians were the only net buyers at LE9.2 million, unlike foreigners and Arabs, net sellers at LE7 million and LE2.2 million respectively. “Investors, especially foreigners and Arabs, will not inject any new funds into the market in such atmosphere. Some are even in a panic, clearing their positions at market prices,” El-Kafrawy commented.

Market leaders, the Commercial International Bank and Orascom Construction Industries drove the market drop, losing 2.41 and 1.67 per cent respectively.

Other heavyweight shares also took a dip as Orascom Telecom and Telecom Egypt fell 1.2 per cent respectively.

Real estate developer Amer Group was the most traded share of the day, making up 6.1 per cent of the day’s total turnover. It dropped five per cent to close at LE1.4 per share. “Amer has gained a lot during the last weeks; this is an obvious case of profit taking,” said El-Kafrawy.

From 179 listed stocks, only eight went up and 167 declined in a session with one of the lowest turnovers during 2011 (LE168.1 million in total).