Egypt Stocks: Mixed trading grips most shares

 

 

Egypt Stocks: Mixed trading grips most shares

 

By Ahmed Kamel

 

As a sideways trend is expected to hit Egypt's stock market, mixed trading may grip most shares this week. Foreign fund managers are forecast to continue their selloffs as world sovereign debt instruments lure cash. 

The benchmark index may retest 11,000 points this week on a local and Arab bullish sentiment. Trading volumes may also increase as retailers buying into blue chips.   

The local stocks ended mixed last week. The EGX30 index slipped 1.08 per cent to 10,898 points.

However, the broader indices EGX70 EWI and EGX100 EWI rose by 0.9 and 0.88 per cent to 2,010.25 and 2,937.87 points respectively.

Volume rose to LE16.4 billion (around $1.05 billion) last week, up from LE13.1 billion the previous week, the Egyptian Exchange said in its weekly report.

Locals, Arabs and non-Arabs accounted for 83.4, 6 and 10.6 per cent of trades respectively, bourse data showed. Excluding deals, Arabs were net buyers of LE2.5 million. Non-Arab investors were sellers of LE383.7 million, market data showed.

Arab and non-Arab investors have been net sellers of LE1.04 billion and LE14 billion since the begging of 2020, according to market data.

Net foreign selloffs reflected a global trend as indirect foreign investment flows declined as fund managers focused on safe havens like gold and real estate. The selloffs have been a symptom of emerging stock markets with investors being motivated by precautious risk management strategies since the coronavirus hit the world economy. 

In the same vein, most fund managers have switched to sovereign debt portfolios to keep away from risky assets. 

As for fundamentals, listed companies posted mixed financial results in the third quarter (Q3) of 2020 on the back of the Covid-19 repercussions.  A number of sectors such as the real estate, education and communications posted better results in the wake of growing demand in Q3.