CAIRO: The Egyptian Exchange (EGX) continued its rally amid high volume Sunday, backed by positive performance of most leading stocks topped by the heavyweight CIB.
It extended its rally and hit a new six-year high for the 5th successive session, shrugging off the government’s decision to finance the Suez Canal expansion project through investment certificates rather than offering an IPO in the stock market as President Abdel Fatah al-Sisi announced on Aug. 5 while launching the new project.
Boosted by CIB’s performance along with real estate stocks, the benchmark index EGX 30 surged to 9,443 points, compared to 9,386 points Thursday.
The small and mid-cap index EGX70 rose by 1.83 percent, registering 654 points, up from 642.9 points, and the broader index EGX100 also went up 1.47 percent to reach 1,166 points.
Market capitalization gained 2.8 billion EGP ($391.58 million,) amounting to 519.7 billion EGP, up from 516.9 billion EGP last session.
“The market advanced and approached its near major resistance level in the short term at 9,500 due to the hike of the bellwether CIB at the beginning of today’s session,” portfolio and asset manager at Cairo Funds Management Amr El-Feky told The Cairo Post.
Due to heavy selling pressure from profit takers, the market erased its morning profits and closed higher but only on the index not on the major stocks, Feky added.
Feky continued; “We still insist on our strategy for short term traders to sell portions of their short portfolios for trading purposes, while medium and long-term investors can hold on to their positions targeting 10,500 before the end of 2014.”
Mohamed Gaballah, Tawfik Securities Brokerage trading head and capital market expert, said “EGX is likely to witness profit taking at the level of 9,450 points as most blue chips headed by CIB reached the overbought level and gave signs of an upcoming correction.”
Meanwhile, liquidity will be transferred to other stagnant stocks that will rally in the upcoming period, Gaballah told The Cairo Post.