Egypt’s main index dipped 4 percent, the lowest since March 16, affected by drop in global markets due to the euro zone’s debt woes and a falling euro, analysts say.
"Egypt is aligning (with) global markets, investors are at a panic stage," said CEO of Arab Finance Brokerage Osama Mourad. "We will see a rebound next week," Mourad said.
Pyramids Capital’s Vice Chairman Hashem Ghoneim said that "if rebound (does) not happen soon, it will be very strange. The drop is an (overreaction) especially in blue chip stocks like Orascom Telecom that have large caps and huge value."
"The index’s drop was affected by OT’s fall, which was already down after bad news on its Algerian unit deal, and now the drop in eruo zone, so it got a double hit," he added.
The Algerian government warned OT on Monday against trying to sell its Algerian unit to anyone other than the Algerian government. OT has been in talks on selling some or all of its assets to South Africa’s MTN.
Stocks declined across the board. Egyptian Resorts was down 9 percent, Talat Mostafa dipped 6.7 percent, and OT was down 6.1 percent.
Commercial International Bank was down 5.1 percent and Orascom Construction Industries <OCIC.CA> dropped 5.3 percent.
The index, EGX30, dropped 4 percent to 6,489 points.