Egypt's stocks recover Thursday amid rumors of OCI dispute settlement

Ahram Online and Reuters, Thursday 21 Mar 2013

EGX 30 gains 1.22 percent on rumours of potential OCI tax dispute reconciliation

File photo: Workers at Egypt's stock exchange market are seen in the trading hall in Cairo, Egypt. 13 April, 2011 (Photo: AP)

Egypt's stock market staged a partial recovery on Thursday after almost two-weeks of losses. Rumours that Orascom Construction Industries (OCI) could finally reach a settlement with Egypt's tax authority, encouraged traders to invest.

A controversial decision by Egypt's prosecutor general to impose a travel ban on OCI founder Onsi Sawiris and OCI chairman Nassef Sawirif on charges of tax avoidance led the market to a 14-week low.

Egypt's main benchmark EGX 30 index rose by 1.22 percent to stand at 5,224 points. The broader EGX70 rose by 0.77 percent.

OCI issued a statement on Thursday assuring investors that negotiations with Egypt's tax authority are still ongoing.

Out of 172 traded stocks, around 117 shares registered gains while a mere 20 suffered losses.

The heavyweight stock OCI registered a significant 4.2 percent gain and closed on LE240, while blue-chip share Commercial International Bank (CIB) unexpectedly suffered a 0.41 percent loss.

"The medium-term trend of the market is still up...The recent consistent decline of 5,800, which is a downward correction within the current medium-term uptrend, is expected to find support prior to the latest explicit bottom on the weekly chart of the EGX30 Index at 4,700," Pharos Holding Research said, Reuters reported.

Turnover registered a weak LE225 million, revealing that foreign investors are still wary regarding the political situation in Egypt.

Egyptian and Arab investors were net buyers for the day picking up LE30 million and LE15 million worth of shares respectively. Foreign investors meanwhile were net sellers offloading almost LE44 million in stocks.

The real estate sector saw a strong performance today with market giants Talaat Mostafa Group Holding (TMGH) and Palm Hills Development rising by a healthy 2.65 percent and 0.47 percent respectively.

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