CAIRO: The Egyptian Exchange indexes rallied during this week amid investors’ upbeat sentiment about the upcoming presidential elections as Egyptian expats started voting Thursday in addition to strong corporate results during Q1 of 2014.
The benchmark index EGX30 jumped 4.17 percent to end the week above the 8,400 resistance level at 8,533 points.
Small and mid-cap index EGX70 edged up 2.48 percent to close at 620.8 points and the broader index EGX100 also rose by 2.5 percent to hit 1,083 points.
Market capitalization gained around 14.6 billion EGP during the week to reach 492.33 billion EGP up from 477.7 billion EGP last week.
“The benchmark index managed to stay above new support level of 8,150 points and resumed the rally towards 8,500 points, backed by positive performance of blue chips, most notably the market bellwether CIB, followed by Global Telecom and EFG-Hermes,” Osool Securities Brokerage head of technical analysis Ehab Saeed told The Cairo Post Friday.
Saeed further noted that CIB stock edged up 1.54 percent to reach 37.6 EGP up from 37.03 EGP. He added that EFG-Hermes rose by 4.2 percent to end at 13.61 EGP, approaching highest level since July in 2012 at 13.76 EGP.
This followed EFG’s announcement that net profits recorded a three-fold rise, reaching 119 million EGP and operating revenue amounted to 563 million EGP during the Q1 of 2014.
“Ezz Steel stock and the majority of real estate shares, topped by Talaat Mousafa Group, Amer Group, Plam Hills, and Madinet Nasr for Housing and Development (MNHD), also backed the market rally,” Saeed added.
Saeed also reiterated that investors are still anticipating the upcoming presidential elections. He urged the two presidential candidates to utilize the stock market as a key source to finance both public and private companies, especially amid government’s tendency to resort to the bourse to finance new projects.
EGX trade value and volume saw remarkable decline during the first half of this week, as turnover slipped on Sunday to its lowest level since December in 2012, registering 370 million EGP. Turnover improved gradually during the rest of the week to record 1 billion EGP on Wednesday then above this level on Thursday, Saeed detailed.
“Daily turnover average ranged at 835 million EGP, up from 795 million EGP during the week before,” Saeed continued. He attributed the market rally during Wednesday and Thursday trading to Arabian Cement’s initial public offering (IPO) being completed after being over-subscribed.
For next week, Saeed expects “EXG30 will continue the rally next week to target 8,600-8,650 points.” EGX70 is also expected to target a resistance level at 630 points if it managed to stay above 617 points.
Over last week’s trading sessions, EGX30 dropped 0.55 percent to end at 8,211 points. The index managed to approach a resistance level at 8,400 points early this week but failed to penetrate it due to profit taking on some blue chips.