Egypt stocks see red for first time in three sessions on Monday (Photo: AP)
Egypt stocks saw a marginal retreat on Monday as investors reacted to recent across-the-board gains with a wave of profit-taking on high-cap shares.
The benchmark EGX30 finished Monday down 0.97 per cent at 5,218.4 points, a relatively small fall after two sessions of healthy gains.
The index surged 2.5 per cent on Sunday following the release of better-than-expected financial results for major firms.
"The drop is normal after the EGX30 gained more than 5 per cent in the last two sessions," said Eissa Fathy, vice president of the securities division in Cairo's Chamber of Commerce. "It's common for profit-hunting slows the bourse a little bit."
Fathy said the fact the drop was just 1 per cent suggested the market will quickly recover.
"The EGX30 might reach 5,400 points in the coming few sessions," he predicted.
From the 184 stocks traded on Monday, 60 gained in value and 113 declined while 11 held their values. Most of the market's high-cap shares witnessed drops.
Total market turnover was LE619.73 million, with Egyptian individual investors again being the most active buyers. Non-Arab foreigners were net-sellers of LE22.64 million worth of stock.
Orascom Construction Industries (OCI), Orascom Telecom Holding (OTH) and Commercial International Bank (CIB) fell by 0.62, 1.74 and 2.67 per cent respectively.
"These [high cap] stocks are floating around their current price levels after they witnessed major increases in recent weeks," Fathy explains.
"OCI, for example has surged from under LE250 per share. It is expected to slow down after its price gained some LE20 pounds. The same goes from CIB and OTH."
OCI closed the day's trading at LE268.7 per share. OTH at LE3.96 and CIB at LE24.81.
Mobile services firm Mobinil, which has led the market following news about an imminent change in ownershop, saw its shares drop 1 per cent to close at LE172.94.
The company's main owners, French Telecom (FT) and Orascom Telecom Media Technology (OTMT), recently announced that FT would increase its stake to 95 per cent, buying out OTMT at LE202.5 per share.
This would mean a 15 per cent profit for those holding the share today. But a second consecutive drop for Mobinil shares shows the company is struggling to capture market sentiment.
"It seems that there are some doubts about the conclusion of the deal, as the Egyptian Financial Supervisory Authority has not approved it yet," Fathy added.
There was drama, too, with Palm Hills Development (PHD), Egypt's second-largest listed real estate developer, which gained 1.78 per cent to close at LE2.29 per share.
Earlier on Monday, the company gained a colossal 7 per cent -- an upsure in interest that prompted it to send a statement to the exchange to say there was no major news concerning the company that was driving the growth.
"It could be normal speculation by traders or just anticipation of a positive outcome in the case relating to the company's land," Fathy suggested.
PHD has seen legal challenges to its vast land bank over the last year. The company is currently appealing a court order that annulled its ownership of a plot in New Cairo suburb. The final court decision is expected on 4 April.
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