Egypt Stocks plunge on MSCI Exclusion Move
Egypt’s stock market plunged Wednesday with 6 billion Egyptian pounds (US$786 million) in losses following MSCI’s decision to exclude Telecom Egypt from emerging market index.
The market capitalization has recorded 491.835 billion pounds during the closing session of Wednesday.
MCSI Dropping Move
Morgan Stanley excluded Telecom Egypt’s stock from its emerging markets index, leaving only three Egyptian stocks in it – Commercial International Bank (CIB), Talaat Moustafa Group and Global Telecom – which analysts said was the minimum required for a country to stay in the benchmark.
“The fall to three stocks does indirectly put Egypt’s emerging market status at risk: the index becomes less diverse -CIB is now 72 percent of the MSCI Egypt index – and investor interest could fall, leading to lower turnover and market cap,” EFG Hermes said.
The expected exit of foreign funds from Telecom Egypt could be complicated by foreign currency shortages in the country, it added.
Indices
Egypt’s benchmark index, EGX30 pushed down by 1.71 percent to 8526.43 points. EGX20 sank by 2.28 percent to 8826.64 points.
In addition, the mid- and small-cap index EGX70 plummeted by 2.33 percent to 453.85 points. The price index, EGX100 fell by 1.53 percent to 944.43 points.
Turnovers surge
On Wednesday, the bourse’s trading volume has recorded 158.836 million securities, with turnovers closed at EGP 1.191 billion, exchanged through 21.891 thousand transactions.
Also during the closing session, 176 listed securities have been traded in; 130 declined, 23 advanced; while 20 kept their previous levels.
Investors’ Activities
Local and Arab investors were net sellers on Wednesday seizing 86.25% and 3.84% respectively of the total markets, with a net equity of EGP 14.420 million and EGP 23.601 million, respectively, excluding the deals.
On the contrary, the non-Arab foreign investors were net buyers capturing 9.91% of the total market, with a net equity of EGP 38.022 million, excluding the deals.
