The benchmark EGX30 slipped 0.14 per cent to 4,672.5 points by close of play, deepening the losses it charted on Tuesday when it reopened after a four-day national holiday.

 

The removal of ousted president Hosni Mubarak's intelligence chief Omar Suleiman, the Muslim Brotherhood's nominee and a Salafi sheikh from Egypt's election race has altered the political landscape weeks before next month's vote.

 

For some, the removal of three divisive figures from the competition has boosted the likelihood of a peaceful transition to democratic rule. But it has also raised the immediate risk of an angry reaction from their supporters.

 

"There are other candidates who can always fill their shoes. And everyone is worried about what happens with the protests this Friday," Omar Darwish of CIBC brokerage told Reuters.

 

If the protests turn violent that could trigger a sharp drop in the stock market. If they pass peacefully they could even lift the market slightly, analysts said, but trading volumes are likely to remain low while uncertainty about who will form the next government remains.

 

Reflecting dampended investor sentiment, turnover on Wednesday was a choked LE254.3 million ($42.1m), with telecommunications firms Orascom Telecom Media and Technology (OTMT) and Mobinil making up the bulk of trade.

 

Trade in Mobinil has been bolstered in recent weeks by the prospect of an imminent conclusion to France Telecom's long-awaited takeover of its mobile phone operations. But despite a total LE30.6 million worth of trade, its stock value failed to move by the closing bell.

 

OTMT stock closed the day up 1.41 per cent, continuing its recent gains, in a performance mirrored by fellow high-caps Ezz Steel, up 0.91 per cent, and Citadel Capital, up 1.06 per cent.

 

Real estate saw modest gains too, with Palm Hills Development closing up 0.62 percent and the Talaat Moustafa Group gaining 0.81 per cent.

 

But the hit felt by Egypt's largest listed firm, Orascom Construction Industries -- which lost 1.3 per cent -- acted to temper broader gains.

 

Non-Arab institutions were the day's big sellers, offloading a net LE32.5 million in stocks. The activities of Egyptian individuals, meanwhile, continued to buoy the market.

 

From the day's 169 traded stocks, 69 gained ground and 73 took losses with the rest holding their value. The broader EGX70 took a slightly bigger hit, slipping 0.27 per cent.

 

Egypt's benchmark index soared 51 per cent at the start of the year, making it the world's best-performing market, but is now down 15 per cent against a backdrop of growing confrontation between the Brotherhood, which dominates Parliament, and the country's military rulers.

 

"People are still stepping aside from the market and yesterday saw the kind of volumes you'd usually expect on a Sunday," said Darwish. "We think we already saw the bottom on most stocks, but ... we'll probably stay here until the picture improves."