CAIRO: The Egyptian Exchange indexes (EGX) plummeted during Thursday’s mid-session, hurt by investors’ selling spree following news about mulling a new tax on stock market profits.
The benchmark index EGX30 slipped sharply 1.13 percent to hit 8,441 points down from 8,537 points Wednesday. Small and mid-cap EGX70 dropped 0.53 percent to hit 602 points and the broader EGX100 was also down 0.56 percent at 1,052 points.
Market capitalization lost a round of 2.7 billion EGP ($377.6 million) to reach 485.7 billion EGP, compared to 488.4 billion EGP Wednesday. Turnover reached 426 million EGP.
Ihab Saeed, head of technical analysis at Osool ESB Securities, attributed the decline to Ministry of Finance decision to mull a new tax on EGX profits cash dividends, hindering indexes from off-setting their losses during the election.
“EGX30 will continue its downward movement to approach 8,400 points by the end of the session,” Saeed told The Cairo Post.
Criticizing government’s decision to impose new taxes on stock market despite its attempts recently to attract new investments to EGX, the analyst said “this would hurt EGX competitiveness among the neighboring Gulf markets.”
The selling pressures started Monday despite expectations that the benchmark could continue its rally, backed by investor upbeat sentiment over the election, due to speculations.
EGX administration suspended its session Tuesday after the Cabinet announced an official vacation amid efforts to allow citizens to cast their votes.
EGX witness a sharp decline Wednesday, and EGX30 slipped sharply 2.27 percent to hit 8,537 points down from 8,736 points Monday. EGX70 dropped 1.36 percent to hit 605 points and the broader EGX100 was also down 1.37 percent at 1,058 points. Market capitalization lost a round of 6.2 billion EGP ($800 million).