CAIRO: The Egyptian Exchange (EGX) extended its negative performance this week, as the benchmark index EGX30 retreated 1.75 percent over intensive sell-offs.
The benchmark dropped to 8,731 points at end of the week. Also, the small and mid-cap index EGX70 fell by 0.7 percent to end at 491 points, and the broader index EGX100 recorded a 1.9 percent slip to 989 points.
“The benchmark index EGX30 failed to keep its upward rebound toward its new resistance level near 9,000 points and slipped near its previous support near 8,500 points where it bounced once more, buoyed by blue chips’ on Thursday,” Osool Securities Brokerage technical analysis head Ehab Saeed told The Cairo Post.
Egypt’s market ended on a collective rise Thursday, pushed by investors’ upbeat sentiment as Egypt finally received $6 billion in deposits as part of Gulf aid pledged during the economic summit held in Sharm el-Sheikh last month.
The benchmark posted a 1.18 percent hike to 8,731 points at close, up from 8,629 points Wednesday.
Saeed attributed the bearish sentiment during the course of the week to the government’s approval of capital-market taxes earlier in April, shrugging off traders’ repeated calls for discarding or suspending it for three years, until the economy recovers.
According to the new regulations, dividend distributions to individual investors with an annual turnover not exceeding 5 million EGP will only be subject to a 5-10 percent tax. Dividend distributions to those with an annual turnover exceeding 5 million EGP, however, will be subject to the general income tax.
“Next week, the EGX30 will focus on its former support near 8,500 points. Sustaining above this level would push the index to re-test its resistance level of 9,600 points at least,” predicted the analyst. “
Saeed also expected the EGX70 to focus on its support near 480 points, noting that holding steady above this level would push the index to re-test 500 points at least.