Egypt Shares Plunge on Sunday, Lose EGP16 billion amid Tax

Egypt’s stocks ended lower on Sunday with losses totalling 16 billion Egyptian pounds (US$2.2 billion) driven by the newly-approved capital gains tax on profits made on stock market.  In return, the main stock index, EGX30 closed below 7895 points amid local investors’ selling pressures.

Last Thursday, the Egyptian government approved the introduction of a 10% capital gains tax on profits made on the stock market.

The tax is part of the first phase of income tax reforms in the country expected to bring in 10 billion Egyptian pounds ($1.40 billion), Egyptian Finance Minister Hany Qadry Dimian said. He said the tax would not be retroactive and would be implemented once a law was issued.

“The cabinet agreed to impose a 10 percent tax on net capital gains that individuals make at the end of the tax year,” Dimian said. “A tax of 10 percent was also imposed on cash dividends and bonus shares.”

Meanwhile, the EGX indices remained in dark red notes during the closing session of Sunday.


Egypt’s benchmark index EGX30 ended 4.22 per cent lower to 7894.73 pts; while EGX20 finished 4.64 per cent down to 9459.34 pts.     
In addition, the mid- and small-cap index, the EGX70 sank by 4.88 per cent to end at 560.73 pts. The price index EGX100 dropped by 4.42 per cent to conclude at 985.24 pts.  
Furthermore, the market capitalization recorded EGP 460.296 billion on Sunday.

Turnovers below EGP1 Billion
Through the closing session of Sunday, the trading volume has reached 310.900 million securities, with turnovers worth EGP 832.387 million, exchanged through 30.051 thousand transactions.               
Also during the closing session, 184 listed securities have been traded in; 161 declined, 6 advanced; while keeping their previous levels.

Investors’ Activities

Egyptian investors were net sellers on Sunday seizing 86.52% of the total market, with a net equity of EGP 77.097 million, excluding the deals.

On the other hand, the non-Arab foreign investors and Arab investors were net buyers capturing 7.56% and 5.92% respectively of the total markets, with a net equity of EGP 72.728 million and EGP 4.368 million respectively, excluding the deals.