Egypt shares hit two month high as investors build up new positions

Elsayed Solyman
5 Min Read

Egypt shares kept rally alive for the second week in a row buoyed by a fresh purchase streak by both Arab and local investors who tend to build a new positions in blue-chips stocks.

The benchmark EGX30 index rose 1.76% or 241.85 to its highest level in two months, closing at 13,955.47 points.

The heavyweight Commercial International Bank – Egypt (CIB) inched up 0.16% in a week at EGP 76.34 at a turnover of EGP 320.11 million exchanged through 4.1 million shares.

The EGX70 index fell 1.16% to 773.76 points, while the EGX100 index slipped 0.27% to 1,739.66 points.

Meanwhile, the equal-weighted EGX50 index added 1.04% this week at 2,475.22 points with a turnover of EGP 4.6 billion.

About 1.5 billion shares were traded on the EGX30 index at a turnover of EGP 4 billion.

Market capitalisation closed the week at EGP 769.9 billion, gaining EGP 2.1 billion from EGP 767.7 billion in the week before.

Arab investors were net buyers with EGP 282.8 million, while foreign and Egyptian investors were net sellers with EGP 99.8 million and EGP 183 million, respectively.

Egyptian investors dominated 77.4% of market transactions, while foreign and Arab investors made up 12.3% and 10.3% of the market’s trading, respectively.

Individuals were net sellers with EGP 433.9 million, dominating 70.3% of market transactions this week, while institutions were net buyers at the same value.

Raya Holding for Financial Investment has rallied 10.2% last week.

The company will invest EGP 100 million in an automotive manufacturing project.

The board of Raya agreed on starting the executive regulations of the project, directly financing the project with EGP 60 million, and obtaining a credit loan of EGP 40 million, the firm highlighted in a statement to the Egyptian Exchange.

This project will include collecting and manufacturing two-wheel drive, three-wheeler, and four-wheel drive vehicles.

The company’s capital amounts to EGP 504.6 million distributed over 100.9 million shares at par value of EGP 5 per share.

The EGX-listed company had previously posted profits of EGP 14.98 million in the three months ended June 2017, versus EGP 42.32 million in the prior-year period.

Meanwhile, Heliopolis Company for Housing and Development was the best performer in the real estate sector last week with its stock gaining 6.5%.

The financial indicators of on Thursday showed a 196% year-on-year hike in profits for the first quarter of fiscal year 2017/2018 due to higher revenues.

The real estate company’s profits amounted to EGP 77 million in the three months ended September, versus EGP 26 million in the prior-year period, the firm noted in a filing to the Egyptian Exchange (EGX).

Revenues jumped 153% to EGP 215 million in Q1 of FY17/18 from EGP 85 million in Q1 of FY16/17.

Heliopolis Housing had previously reported that it achieved EGP 348.8 million in FY16/17, compared to EGP 400.6 million in the previous fiscal year.

The benchmark EGX30 is expected to maintain its positive performance and test 14,150 points next week.

The market expert Safaa Fares said that the EGX30 index has resistance at 14,100 points and has an upside potential at 14,400 points.

The index has support at 13,830 points and a downside potential at 13,650 points, Fares highlighted.

The EGX70 index has resistance at 784 points, she added, noting that breaking above this level will push the index up to 796 and 770 points.

The market analyst continued that the EGX70 index may break support below 763 points.

Mohamed Khedr, head of technical analysis at Prime Securities, forecasted the EGX30 index to test resistance at 14,150 points and see support above 13,700 points.

Global Telecom may stop witnessing medium-term sideways moves, which lasted for eight months between the levels of EGP 6 and EGP 7.25, Khedr mentioned.

He pointed out that the stock started to see a new strong bullish trend toward EGP 8.2.

Kheder recommended short-term investors to trade on each stock separately.

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