CAIRO: Late selling on Orascom Telecom wiped out most of the earlier gains on Egypt s benchmark index, which closed 0.9 percent higher.
Traders said retail investors reassessed the value of the stock, which opened at a diluted price following a share rights issue. Orascom shares jumped as much as 31 percent before closing 8 percent higher, at implied value.
The session started on a high move, and Orascom Telecom was up on speculation … and as more retail investors started allocating to it, said Sally Refaat of Cairo Capital Securities. But at the end of the day, it was over-valued, and we started to see selling pressure.
Refaat expects more speculation on Orascom Telecom this week. It will be very volatile.
The two other listed telecom stocks, Telecom Egypt and Mobinil, were the only other gainers on the index.
Index heavyweight Orascom Construction Industries exerted downward pressure, falling 1.9 percent, and EFG-Hermes shed 3.4 percent.
Traders said they expect a slowdown on the index in coming days ahead of full year results season and due to international markets that had traded negatively over the past week.
Corporate results will define a lot of things in the coming days, says Teymour El-Derini of Naeem Holding said.
The EGX 30 index ended the day at 6,756 points. -Reuters