CAIRO: The Egyptian Exchange (EGX) soared Thursday and the benchmark index EGX30 approached its strong resistance level at 9,200 amid high volume backed by a strong buying spree from local and foreign institutions.
EGX rally came in conjunction with ending some precautionary measures that were adopted after the January 25 Revolution in 2011 as trading rates returned to normal levels. EGX returned to the price discovery session and unified price limits for the main market at 10 percent and NILEX at 5 percent.
The benchmark index EGX30 managed to shoot above its new 6-year high, surpassing the 9,000-point barrier, edging up by 1.16 percent to hit 9,152 points, compared to 9,047 points Wednesday.
The small and mid-cap index EGX70 rose by 0.56 percent, registering 632 points compared to 629 points and the broader index EGX100 also increased by 0.49 percent to reach 1,125 points.
Market capitalization gained around 3.2 billion EGP ($447.4 million,) registering 510 billion EGP up from 506.8 billion EGP last session.
Chief technical analyst at Helwan Securities Ahmed Abdel Rahman attributed the hike to Arab and foreign purchases mainly on leading stocks including the Citadel, Talaat Moustafa, Amer Group, and Ezz Steel amid an upbeat sentiment among retail traders.
“Most blue chips hit an all-time high and the benchmark is not likely to breach above 9,200 points before a price correction takes place to protect the uptrend without concerns,” Abdel Rahman told The Cairo Post. EGX30 is targeting 9,670 points to 10,500 points in the medium-term.
El-Mokattam Securities Brokerage technical analyst Walid Helal had expected the benchmark to approach the 9,200 area Wednesday.
“EGX30’s performance remains positive and the market indicators show a tendency to resume the upward movement targeting 9,200 points,” Helal said.
Meanwhile, Helal expected that the upcoming sessions would witness minimal profit taking, giving a chance for purchasing power to enter the market.