The government’s IPO program helped Egypt’s stock market end last week’s trading in the green zone, as optimism prevailed among stock market traders.
The benchmark index EGX30 closed at 17,342 points at the end of last week’s trading, recording an increase of 1.4%, while the EGX70 EWI decreased by 1.33% to 3,428 points.
The EGX30 closed up about 1.08% to 21,074 points, and the broader EGX100 index fell 1.2% to settle at 5084 points.
Moataz Ashmawy, Managing Director of Arabeya Online, said that the EGX30 broke the resistance level of 16,800 points at the beginning of the week, and the emergence of purchasing power pushed the index up to 17,300 points.
He explained that the rest of the leading stocks followed the stock of the CIB, and headed for an increase, which contributed to the rise of the main index, with a decrease in trading rates compared to previous months.
He explained that the reduction in trading rates came due to the liquid withdrawal operations from Al-Warsa, which reached EGP 3bn, in preparation for the Beltone subscription process.
Ashmawy expects the main index EGX30 to rise to the level of 17800 points during this week’s trade, and a positive performance for stock market indicators due to positive and encouraging news for the current economy.
The market recorded a trading value of EGP 15bn, and circulation of 3.8 billion shares through 115,600 operations last week, compared to a trading value of EGP 6bn, and circulation of 2.5 billion shares through 209,000 operations two week ago.
Egypt’s stock market recovered from a sharp decline last week, as positive news of government exit deals boosted investor sentiment, said Mohamed Hassan, Director of Investment Fund at Odin Investments.
Hassan expects the EGX30 to continue its positive performance in the coming weeks, and reach the level of 17,600 points and 17800 points, supported by the stability of the economic situation.
He said that the index EGX70EWI, which tracks small and mid-cap stocks, closed at the support level of 3,400 points, and began to rebound. He expects it to continue to rise in the coming weeks, with a return to the flow of liquidity following positive economic news.
Hassan advises investors to engage in quick trades between support and resistance levels during the current period, and avoid buying on margin, until the market’s outlook is clear. He said he expects the indicators to move sideways in the medium and short term.
Foreigners recorded a net sale of EGP 251m, with a share of 6.6% of the operations of sale and purchase of stocks, while Arabs sold a net of EGP 21.2m, with a share of 7.1 %, excluding deals.
Stocks accounted for 82.55% of transactions on the Egyptian Exchange last week, while bond sales represented about 17.45% of transactions.