CAIRO: The Egyptian Exchange (EGX) lost ground during Thursday’s early and mid-session trading as selling pressures dominated the market after reaching a new 6-year high yesterday.
Trading volume was hit by a massive power cut across Egypt’s governorates Thursday morning, causing disruptions in Metro train service.
The EGX30 fell by 0.15 percent to hit 9,612 points, compared to 9,627 points Wednesday. The small and mid-cap index EGX70 decreased by 0.24 percent, registering 662 points, down from 663.6 points last session and the broader index EGX100 lost 0.17 percent to reach 1,197 points.
Despite the collective slide, market capitalization added around 1.1 billion EGP ($153.8million), reaching 529.2 billion EGP, compared to 528.1 billion EGP in its last session.
“The EGX declined due to technical indicators as the benchmark index managed to hit its target at 9,670 points. A price correction for most stocks led by heavyweight CIB is a must to protect the uptrend,” Ahmed Abdel Rahman, chief technical analyst at Helwan Securities, told The Cairo Post Thursday.
Abdel Rahman added that today’s session also coincides with the first day of the issuance of Suez Canal investment certificates. “This will of course attract cash liquidity from the stock market, namely from retail investors.”
The government will issue the certificates to raise 60 billion EGP to finance the project, which aims to increase the capacity of the vital waterway. The certificates will be offered with a lifetime of five years at a 12 percent interest rate.
Abdel Rahman further noted that today’s massive blackout had a negative, but “limited” impact on trading volume, namely in the first hour of the session. “This session is a turning point in the market short-term trend,” he said.
Meanwhile, EGX head Mohamed Omran told Reuters, “Trading is normal in the stock market and we have certain preparations to keep up working in case of any power cut.”
Minister of Electricity Mohamed Shaker said in statements to ONTV channel Thursday that the power cut was not due to any kind of “destructive” acts, and was instead the result of a technical malfunction, Youm7 reported.
A statement by the Electricity Ministry said a malfunction occurred in the electricity network in East Cairo, which caused a chain reaction in the power grid.