CAIRO: Share prices increased Sunday after last week’s significant volatility, associated with the start of trading in Telecom Egypt (TE) shares.
The CASE 30 index, which tracks the top thirty stocks on the Cairo and Alexandria stock exchanges, gained 1.41 percent Sunday closing at 6050.19 points.
The market experienced a general decline prior to the beginning of TE stock trading last Wednesday as investors cleared part of their portfolios to make room for subscriptions to TE.
“Everyone had speculated on Telecom Egypt, so they liquidated their existing stocks to subscribe in anticipation of making a profit, said Walaa Hazem, research associate at HC Brokerage.
With small investors keen on making a quick profit on the first day, there was heavy trading volume on Wednesday when LE 1.24 billion worth of TE shares changed hands.
Trading cooled somewhat on Thursday, but TE shares continued to be sold causing a decline in its price of approximately 12 percent to LE 20.51.This activity also affected other stocks as the CASE 30 index declined substantially by 1.07 percent.
“The concentration of trading on Telecom Egypt resulted in a general decline in stock prices on Thursday, said Hazem.
As businesses close their books for the year and with the holiday season approaching, the volatility is not expected to continue.
“We expect a slight increase in prices this week, followed by stability in the last week of 2005, said Hazem.
Meanwhile, Al-Ahram Al-Iqtisadiya newspaper reported Sunday that several investors complained to the Capital Market Authority (CMA) regarding the fact that they were not allocated their subscription to TE despite having completed the necessary formalities and paid the required deposit.
This was attributed to a failure in the systems of brokerage companies due to the large demand on the initial public offering (IPO). A number of brokerage firms requested that banks close their accounts and, as a result, the deposits of some investors were not received.
Head of CMA Hani Sarie El-Din confirmed that several investors did not receive an allocation in the IPO due to the failure of brokerage systems, and that such cases were mostly relating to investors who tried to subscribe on the final day of the subscription period.