Market Report: Political quiet drives Egypt bourse upward

Ahram Online , Sunday 22 Apr 2012

EGX30 climbs almost 2.5 pct following peaceful conclusion of Friday's Tahrir Square rally; Trading on Mobinil, OTMT set to resume Monday

Egypt's stocks saw gains on peaceful protests in Tahrir last Friday (Photo: Reuters)

Egypt's benchmark EGX30 index edged up 2.47 per cent on Sunday to close the week's first session at 4,829 points. The broader EGX70 index, meanwhile, rose by 3.11 per cent for the day.

Eissa Fathy, vice-president of securities at Cairo's Chamber of Commerce, said the rebound was "mainly driven by political considerations."

"Investors were heartened after Friday's Tahrir Square demonstrations passed without incident,'' Fathy told Ahram Online.

A sit-in staged largely by supporters of disqualified Salafist presidential candidate Hazem Abu-Ismail drew hundreds of thousands of participants on Friday.

Trade volume, however, remained paltry, with Sunday's session registering only LE311.13 million (roughly $50 million) in turnover – far lower than the levels seen in the first two months of this year.

"The market is currently missing two of its most liquid shares – Mobinil and Orascom Telecom Media Technology (OTMT) – and this is taking a toll on trade volume," explained Fathy.

On Thursday, the Egyptian Financial Supervisory Authority (EFSA) temporarily halted trading on the two blue-chip shares pending review of an acquisition deal between Mobinil and France Telecom (FT). Following Thursday's trading session, the EFSA announced its approval of FT's tender offer for 100 percent of Mobinil at LE202.5 per share.

Trading on Mobinil stocks is expected to resume on Monday.

Last week, FT finalised a deal to buy most of its partner's stake in Mobinil for a total of 1.5 billion euros (roughly $2 billion), leaving 95 per cent of the venture in French hands but retaining a significant Egyptian presence in the company's board of directors and upper management.

Talaat Mostafa Group Holding (TMG) saw the largest turnover in Sunday trading at LE33.7 million, followed by Orascom Telecom Holding at LE24.12 million.  

Egyptian investors were net buyers for the day, purchasing LE88.76 million worth of stocks. Foreign and Arab investors, meanwhile, represented net sellers, offloading a total of LE2.173 million and LE6.527 million worth of stocks respectively.

Of the market's 173 listed shares, 153 posted gains on Sunday while nine declined in value. The rest remained largely unchanged.

Egypt's largest firm in terms of market capitalisation, Orascom Construction Industries, gained 2.63 per cent for the day, with fellow big caps Telecom Egypt and OT rising in value by 3.08 per cent and 2.86 per cent respectively.

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