EGX looks for incentives to compensate for foreign investors’ exit

Daily News Egypt
3 Min Read

Egypt is expected to receive a loan from the International Monetary Fund (IMF) with an approaching agreement, according to Managing Director of the IMF Kristalina Georgieva.

Daily News Egypt learned that the Egyptian delegation participating in the IMF and World Bank Annual Meetings that are currently being held now in Washington, will discuss the final touches to the loan agreement.

In a related context, experts unanimously agreed that reaching an agreement on the IMF loan would reflect positively, especially in light of the prevailing recession due to the exit of foreign investors, and the fluctuation of the exchange rate.

The benchmark EGX30 closed Wednesday’s trading session at 9,800 points, down 0.7%, and EGX50 EWI also decreased by 1.1% to 1,867 points.

EGX70 EWI also recorded a decline of 1.5% to 2,121 points, and EGX30 capped decreased 0.8% to 12,054 points, and the broader EGX100 fell by 1.4% to 3,041 points.

Economist Hani Genena said that Egypt’s reaching an agreement on the IMF loan will determine the fate of foreign investments in Egypt over the next five years.

The market recorded trading values ​​of EGP 883.1m through the circulation of 423.3 million shares, with the implementation of 38,100 buying and selling operations, after the shares of 195 restricted companies were traded, 25 of which rose, and the prices of 98 securities declined, while the prices of 72 shares did not change. The market capitalization reached EGP 683.9bn.

Meanwhile, Alia Mamdouh, the senior economist at Beltone, believes that the impact of the invested change in the dollar exchange rate against the pound is positive for deals in place of acquisitions, as the value of assets will become more attractive in relation to their dollar value.

The net transactions of Egyptians alone tended to buy, recording EGP 174.8m, with 80.8% of buying and selling transactions on the shares, while the net transactions of Arabs and foreigners tended to sell, recording EGP 39.9m and EGP 134.8m, respectively, with acquisition rates of 8.1% and 11.1% respectively.

Mustafa Al-Kurdi, group head of the Arab African International Securities, expected that the main index of the Egyptian Exchange will test the supporting level at 9,600 points, and it is likely that if it breaks down, the main index will lose about 1,000 points, especially in the absence of the stimuli that the market desperately needs.

Al-Kurdi added that Egypt will soon reach an agreement on the IMF loan, which will positively affect the financial market.

He added that EGX70 is performing better than EGX30 currently, and is likely to test the support level at 2,100 points in the coming period, advising investors to stay away from marginal buying, and select stocks.

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