CAIRO: The Egyptian Exchange (EGX) ended on a mixed note Sunday and market capitalization shed around 1.4 billion EGP ($195.78 million) due to profit taking after the market hit a 6-year high last week.
Hurt by the performance of exchange heavyweight CIB, the benchmark index EGX30 fell 0.39 percent to hit 9,117 points, compared to 9,152 points Thursday. In turn, the small and mid-cap index EGX70 rose 0.02 percent, registering 632.9 points compared to 632 points, while the broader index EGX100 lost 0.07 percent to reach 1,124 points.
Market capitalization dropped to 508.6 billion EGP, down from 510 billion EGP last session.
“The benchmark index started heading south during early trading Sunday, and reached 9,070 points before reducing its loss to end at 9,117 points after being battered by minimal profit taking,” said Osama Naguib, head of technical analysis at Arab Finance.
Trade volume fell during Sunday’s session to 436 million EGP, while the daily average registered 591 million EGP during July, Naguib told The Cairo Post Sunday. “This shows that the selling powers do not dominate the market. Accordingly, we do not predict that the EGX will witness intensive selling pressures right now.”
Naguib advised investors to take advantage of the downward movements in accumulating stocks and build new positions at better prices in preparation for the upcoming hike to between 9,400-9,500 points.
“The benchmark index approached its target at 9,200 points during last week and it is normal to witness a correction or minimal profit taking this week,” Tawfik Securities Brokerage trading head and capital market expert Mohamed Gaballah said.
Gaballah told The Cairo Post Sunday the market bellwether CIB stock reached its target at 44 EGP last week and will face profit taking that will drive it downward to 41.70 EGP, which is worth 137 points on the benchmark index.
“The EGX30 will likely slide toward 9,050 points due to CIB’s decline. Accordingly, there will be a kind of separation between the main index and the stocks which remained above their support levels. That is why there is no need for any panic or concerns,” Gaballah said.
The EGX surged last week and the benchmark index jumped 3.7 percent, reaching the highest level since August 2008 amid investor sentiments about the launch of two mega projects in the Suez Canal zone by President Abdel Fatah al-Sisi.
The market was also supported by the end of some precautionary measures that were adopted after the January 25 Revolution in 2011 as trading rates returned to normal levels. According to the system, the EGX returned Thursday to the price discovery session and unified price limits for the main market at 10 percent and NILEX at 5 percent.