Market Report: Political stability maintains Egypt stock rally

Ahram Online, Tuesday 26 Jun 2012

Bourse continues to heave sigh of relief following Sunday announcement of Morsi's presidential victory, with EGX30 rising 2.8 per cent in Tuesday's trade session

Egypt
Egyptian traders chat at Egypt's benchmark stock in Cairo (Photo: AP)

Egypt stocks on Tuesday continued to celebrate the Sunday announcement of Muslim Brotherhood candidate Mohamed Morsi's presidential victory, with the benchmark EGX30 index surging 2.8 per cent for the day to alight at 4,612 points.

Eissa Fathy, head of securities at the Cairo Chamber of Commerce, explained that, as long as recent political tensions appeared to be contained, the bourse would maintain its current upward trajectory.

"The country's recent tense political atmosphere has eased and this has been reflected by the market's performance," Fathy told Ahram Online.

The broader-based EGX70 index also rose for the day by 2.5 per cent.

Egyptian investors were the only net buyers on Tuesday, picking up LE37.7 million worth of shares. Their foreign counterparts, meanwhile, sold off more than they bought, to the tune of LE20.4 million.

"Now is a good time for foreigners to take profits, since investors across the board have suffered losses in recent weeks," Fathy said.

Blue-chip stocks Commercial International Bank (CIB) and Orascom Construction Industries both rose for the day, by 4 and 2.8 per cent respectively.

On Tuesday, financial news agency Bloomberg reported that shares in CIB, which closed the day at LE25.4, had reached their highest levels in more than a month.

Orascom Telecom Media and Technology (OTMT), meanwhile, neither gained nor lost, despite enjoying one of the day's highest daily turnover rates at LE64.7 million. On Tuesday, OTMT was officially approved by the UK Listing Authority, allowing it to be traded on the London Stock Exchange.

The telecommunications sector in general did well for the day, with Orascom Telecom, Mobinil and Telecom Egypt all rising by 3, 6.5 and 4.5 per cent respectively.

Real estate giants Palm Hills and the Talaat Mostafa Group, meanwhile, led the property development sector, with both rising in value by 7 and 2.6 per cent respectively.

Out of 182 stocks listed on the exchange, 147 gained and 23 saw losses in a session that saw total daily turnover hit a whopping LE519.3 million.

"The Egyptian market on Monday and Tuesday enjoyed its highest daily turnover rates in more than three months," said Fathy.

Short link: