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EGX closes at lowest level in 10 months

EGX closes at lowest level in 10 months
The Egyptian Exchange (EGX) - (Photo Archive)

Cairo – Mubasher: The Egyptian Exchange (EGX) maintained a strong downward trend on Monday, with selling pressures from foreign investors leading to more than EGP 10.5 billion in market cap losses.

EGX paused today’s trading session earlier for half an hour due to the EGX100 EWI index falling by more than 5%.

The benchmark index EGX30 finished lower by 1.54% at 10,256 points, its lowest closing level since June 2020.

The small and medium enterprises index, EGX70 EWI, dropped by 6.27% to close at 1,868 points.

Meanwhile, the broader EGX100 EWI declined by 4.94% to settle at 2,783 points.

Similarly, the equal-weighted EGX50 index plunged by 4.2% to 1,947 points.

Market capitalization decreased by EGP 10.52 billion to EGP 635.942 billion.

The trading activity of foreign investors saw EGP 1.17 billion in net selling, while Egyptian and Arab investors registered net purchases of EGP 584.59 million and EGP 588.4 million, respectively.

Traded volumes stood at 524.18 million shares with a turnover of EGP 872 million, through around 38,700 transactions.

According to market analysts, the market drop can not be explained as it comes with no apparent reason or a major development.

Mohamed Gaballah, Strategies and Business Development Director at Pioneers Securities, told Mubasher that there is no clear reason behind today's negative performance, expecting that it might be due to concerns about geopolitical risks or due to anticipated application of new marginal trading rules.

Gaballah believes that the market will surely rebound from the current irrational levels.

A Trading Manager at Arabeya Online, Mona Moustafa, said that the drop in the market might be an indicator of anticipating a major event.

The decline of the market's major indices is due to a returning uncertainty among investors, according to the Head of the Capital Markets Committee at the African Economic Council, Ayman Fouda, who told Mubasher that market regulators must intervene to assure investors that in terms of the current macroeconomic scene and the country's geopolitical status, there are no fundamental reasons to explain the excessive wave of recurring and unexplained selling activity.

Fouda called upon local funds to step in and support blue-chip stocks that plummeted to low levels that do not reflect its real value, making an opportunity for profit-making.