Global declines hit Egyptian stock market

CAIRO - Egypt’s benchmark stock index fell on Tuesday to its lowest close since last Sept. 20 in line with declines in emerging and other markets across the world.

By (Reuters)

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Published: Tue 13 Jun 2006, 10:53 PM

Last updated: Sat 4 Apr 2015, 3:24 PM

Egyptian brokers said local factors and company news had little to no effect on the fall in prices, which left some companies with p/e ratios in the range of seven or eight.

”It’s a global market sell-off. It wasn’t very much fixed on Egypt. Japan dropped four percent and the emerging markets got bombarded,” said Yasser Hassanein of Dynamic Securities.

Bassim Arida said the day was relatively gentle on the Egyptian market, compared to declines in Russia and Turkey for example. The benchmark Hermes index fell 2.2 percent to 44,095.62 points -- not unusual volatility for recent months.

He said the stocks hardest hit were those with GDRs on the London market because GDR investors have less special knowledge of Egypt than foreigners who buy locally.

EFG-Hermes was both the biggest percentage decliner and the most heavily traded share, tumbling 9.5 percent to a year-low of 25.20 pounds ($4.38).

Orascom shares with GDRs were also badly hit. Orascom Telecom lost 5.9 percent to last trade at 245.00 pounds, while Orascom Construction Industries sank 5.8 percent to 170.00, another year-low.

The CASE 30 index, which tracks the most heavily shares, fell 2.8 percent or 139.48 points to 4,896.25.

Hassanein said that 5,000 was an important resistance level fior the CASE 30. “Tomorrow we will open at 4,750, perhaps even less than that if it continues to go on. The market is very weak and the buying power is really extinct,” he added.

But the broader CIBC index was much more resilient, reflecting the narrow effect of the decline. It closed 0.6 percent down at 193.49 points.

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