CAIRO: The buzzword on the Egyptian stock exchange was foreign selling this week. While starting off the week in the green, the Egyptian stock market quickly reversed trends, reeling from a downgrade report by rating agency Fitch, and foreign selling weighed on the bourse.
Cheaper stocks triggered Thursday foreign buying on the market and the market snapped its three-day losing streak. Overall, Egypt’s benchmark CASE 30 index lost 2.92 percent to close the week at 7,982.74 points.
After falling to very attractive levels in the past week, shares of Talaat Moustafa Group (TMG) turned green on Sunday, lifting the Egyptian stock market.
The CASE30 Index gained 1.3 percent to 8,327.90 points, with the market trading on a very weak turnover of LE 824 million ($155 million).
Egypt’s largest real estate developer TMG saw its shares leap 5.8 percent to LE 6.92, following the previous week’s heavy losses. TMG shares scored the session’s highest turnover worth LE 145 million.
Shares of Orascom Telecom (OT) also helped the index on Sunday. The regional telecom giant rose 2.5 percent to LE 54.78 after the firm announced on Thursday it plans to buy 45 million of the company s shares back from the market.
The company s global depositary receipts (GDR) also pushed its price in Cairo. Its GDRs closed 0.8 percent higher on Friday.
Weighing on the market were shares of sister company Orascom Construction Industries (OCI) which lost 2 percent to LE 328, dragged by its GDRs after they traded 1.6 percent lower.
Shares in El Ezz Steel also retreated 2 percent to LE 64.75 despite reporting a 63 percent first half increase in net profit on Sunday, as investors took profits.
The stock market quickly reversed Monday its two-day rally, as wary investors sold in major market constituents despite a slew of positive corporate results.
The index slipped 1.1 percent to 8,233.91 points, trading on a weak turnover of LE 889.7 million ($168 million).
Selling in index heavyweights OT and OCI, which together constitute around 50 percent of the index, pulled the stock market down.
Shares in regional mobile operator OT sank 1.86 percent to LE 53.76. The market shrugged off news that the firm plans to buy back up to 8.9 million GDRs or 44.9 million ordinary shares over the next 12 months.
Construction conglomerate OCI saw its shares dip 2.26 percent to LE 322.
Shares of blue-chip Commercial International Bank (CIB) also closed in the red, trading 2.52 percent lower to LE 47.95.
Bucking the downtrend were shares of regional investment bank EFG-Hermes, gaining 0.14 percent to LE 44 after the firm announced Monday it bought a 50 percent stake in Offset Holding KSC, a brokerage unit owned by Kuwait Invest Holding Co.
Shares of TMG outperformed the market, climbing 1.7 percent to LE 7.04.
TMG shares extended gains for the second day in a row and scored the session’s highest turnover at LE 182 million.
The stock exchange fell Tuesday to its lowest close in the week on heavy foreign selling caused by a statement by ratings agency Fitch that cut Egypt s ratings outlook and currency rating.
The index plunged 3.3 percent to 7,964.93 points, trading on a turnover of LE 982 million ($183 million).
The international rating agency Fitch downgraded Monday Egypt’s ratings outlook to stable from positive and cut Egypt’s local currency rating to BBB- from BBB.
The downgrade in both outlook and local rating was due to rising inflation from higher food and fuel prices, stated the agency. This year s surge in global food and fuel prices has increased the challenges facing Egypt s policymakers. . The power of Egypt s monetary tools to curb inflation is still quite weak, raising the prospect of double-digit inflation continuing well into next year , reported Reuters quoting a statement by Richard Fox, head of Middle East and Africa sovereign ratings at Fitch.
The negative news took its toll on the Egyptian stock market on Tuesday, as the index slumped and flared red almost across the board. The Fitch report prompted foreign selling on blue chips.
Among the hardest hit were shares of TMG which reversed tracks and plummeted a hefty 7.67 percent in heavy trading to LE 6.50. The firm scored the session’s highest turnover for the third consecutive day worth LE 134 million.
Index mainstay OCI shed 5.69 percent to LE 303.88, while OT sank 3.39 percent to LE 52.18. El Ezz Steel tumbled 5.4 percent to LE 60.15.
Shares in CIB also closed in the red after another Fitch report on Tuesday downgraded ratings on Egypt s largest listed bank. Shares sank 4.58 percent to LE 45.80.
Foreign selling pressure rang the stock market to new lows on Wednesday, as fears of a negative economic outlook and inflation continued to loom. The index fell 2.11 percent to year low of 7,797.21 points, trading on a turnover of LE 884 million ($166 million).
Selling was across the board, with only 19 stocks rising compared with 144 declines, Reuters reported.
Construction guru OCI shed 0.6 percent to LE 305.33 on the session’s highest turnover, while regional telecom giant OT slipped 1.7 percent to LE 51.36. El Ezz Steel lost 5.8 percent to LE 56.69.
The entire housing and real estate sector was out of favor with TMG diving 5 percent to LE 6.31 and Six of October Development and Investment (SODIC) falling 4 percent to LE 119.99.
Shares of CIB extended losses and retreated 4.1 percent to LE 44.75, while EFG-Hermes slid 0.4 percent to LE 43.05.
Tampering the market’s anger was Rowad Tourism which scored the biggest gainer of the day, rising 10.19 percent to LE 301 after announcing a plan to buy back up to 4 percent of its issued capital from the market.
The market rebounded on Thursday, reversing its three-day losing streak, as cheap stocks stimulated foreign buying into the bourse. The index gained 2.38 percent to close at 7,982.74 points.
Shares of OCI led gains, edging 1.86 percent higher to LE 311, while OT rose 1.25 percent to LE 52 per share.
Investment bank EFG-Hermes jumped 3.76 percent to LE 44.67, as investors refreshed their appetite for the stock on the new Kuwaiti acquisition.