Credit Suisse sees positive outlook for Egypt stock market

Egypt’s stock market (EGX) is poised for a recovery led by a positive outlook for local companies, Credit Suisse said on Sunday.

A drop in trading volume following a pandemic-led slump and a decline in the number of stocks included in global benchmarks were “significant headwinds” to the Egyptian stock market recently, according to Fahd Iqbal, the head of Middle East research at Credit Suisse in Dubai.

The EGX 30, little changed on Sunday, has dropped 22 percent this year, compared to an 8.5 percent increase for the MSCI Emerging Markets Index.

“We’re positive across a lot of areas of Egypt,” Iqbal said in an interview with Bloomberg TV. While low liquidity remains a concern, he said fundamentals are “very robust” and “the growth outlook for exporters and for domestically-focused companies alike is very constructive.”

The Egyptian pound is not expected to fall by more than 5 percent over the next year, Iqbal added.