Egyptian stocks reach highest level since 2011 revolution

Ahram Online, Tuesday 17 Dec 2013

EGX30 index rises on referendum hopes; experts expect the trend to continue

Traders work at Egypt's Stock Exchange in Cairo July 3, 2013 (Photo: Reuters)

After a slight drop on Monday because of profit-taking, the Egyptian stock market reversed its downwards trend in Tuesday's session.

The benchmark EGX30 index gained 1.15 percent in the session to reach 6644.27 points, the highest level since January 2011.

"Generally, investors are optimistic as they expect the political situation to stabilise as the date for the referendum on the draft constitution has been set," said Issa Fathi, vice president of the securities division at Cairo's Chamber of Commerce.

On Saturday interim President Adly Mansour announced that a national referendum on the draft constitution will take place on 14-15 January 2014.

Investors believe that if the referendum takes place on time, "the political process will go smoothly," Fathi said.

Total turnover reached LE602 million ($87 million) versus LE323.8 million ($47 million) on Monday. 

"It is a good sign to see turnover increase when investors buy and decrease while the market is down. That means that traders are not selling in a compulsive way," argues Fathi. 

He explained the market slow-down on Monday as a result of profit-taking. 

"The market can not only inhale; it needs to exhale as well," he said.

Domestic and Arab investors closed as net buyers, while foreigners were net sellers. 

The real estate sector led the market in terms of turnover, with Palm Hills Development Company gaining about 2 percent and TMG Holding 1.15 percent.

The biggest market cap, Commercial International Bank (Egypt), gained 0.8 percent.

The broader EGX70 index gained 0.65 percent.

Out of 184 listed stocks, 122 gained while 41 declined. 

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