By: Heba El Kordy

Cairo – Mubasher: The Egyptian Exchange (EGX) suffered a sharp decline in the first couple of hours of trading on Wednesday, with its benchmark index falling to its lowest level in 18 months.

By 11:29 am Cairo time, the EGX30 index retreated 0.71% or 89.39 points to 12,535.47 points, despite a rise in its heaviest weighted stock, the Commercial International Bank (CIB), which grew 0.65% to EGP 70.97.

Over the past two weeks, the EGX has suffered a sharp wave of declines pressured by banking stocks, particularly CIB, which had plunged by 13% over the two-week period. CIB’s fall came on the back of tax amendments to returns from bonds and treasury bills.

On Wednesday, CIB said its 2018 budget would not be affected by the suggested amendments to government bonds and treasury bills as they amendments would not be imposed retroactively.

CIB forecast that its profits would decline by around 5% in 2019 on the back of the amendments.

Turnover on the EGX amounted to EGP 198.9 million after 56.3 million shares were traded. Since the start of the year, the benchmark EGX30 index has plummeted by 16.04%.

Several blue-chip stocks traded lower, including Abu Qir Fertilizers and SODIC, which lost 5.25% and 4.59%, respectively.

Last week, the Ministry of Finance (MoF) said it signed an agreement with the Federation of Egyptian Banks to implement its suggested tax amendments regarding new bond and T-bill issuances. The amendments will not be implemented retrospectively.