In February, Egypt Shares Gain EGP40bn, EGX30 Highest in 5yrs and Half

In February, Egypt’s main stock index reported during February its highest point in 5 years and half, since September 11, 2008. In return, the country’s bourse posted gains approximately worth 39.9 billion pounds bolstered by the relative calmness at the political arena ahead of Defense Minister Abdel Fattah El-Sisi’s potential presidential bid.

Market experts and analysts expect EGX30 to target 8500 level in the short term. They also attributed EGX indices’ rally during February to the relative political calmness and the formation of a new military-backed government led by Eng. Ibrahim Mehleb.
Mountasir Madbouly, head of technical analysis at El Orouba for Securities Brokerage, expects the benchmark to continue the upturn towards 8300 points and 8500 points.

He added that, in case of seeing profit taking and correction, the index will find support at 7750 points.

“Positive trading activity is expected to continue in the medium and long-terms unless the index closes below 7700 points,” said the analyst, “Traders should reduce their positions in stocks that surged and begin to build positions in stocks that started to move higher.”

Through February – the main index, EGX30 soared 9.75% to end at the level of 8127.44 points.

For the mid- and small-cap index, the EGX70 jumped by 11.39% to close at 651 points. In addition, the price index EGX100 climbed by 12.79% to conclude at the level of 1119 points.

Furthermore, market capitalization ended at EGP 491.847 billion by the end of February’s sessions, compared to EGP 451.912 billion by the end of last January’s sessions.

Turnovers & Market Summary

In February, EGX’s traded volume reached around 5.743 million securities worth turnovers of around EGP 26.9 billion, exchanged through 806 thousand transactions. Noting that, through last January the traded volume had reached 5.792 million securities worth turnovers of around EGP 19.1 billion, exchanged through 643 thousand transactions.

Elsewhere, the traded volume for the EGX of SMEs – NILEX through February has amounted to 33.7 million securities worth EGP 124.4 million, exchanged through 16.609 thousand transactions.

For EGX’s Over-The-Counter – OTC trading, the shares had seized 72.02% out of the total traded value; while traded value of the bonds represented 27.98% in February.

Investors Activities:

Local investors led the market activity through February, seizing 87.98% of the total market; while non-Arab foreigners and Arabs acquired 6.47% and 5.56%, respectively of the total market, after excluding the deals.

Excluding the deals, the non-Arab foreigners were net buyers in February, with a net equity of  EGP 233.87 million; while Arabs were net buyers, with a net equity of EGP 29.32 million, after excluding the deals.

Also in February, institutions had seized 44.42% of the EGX’s transactions; while individuals had 55.58%.

Institutions were net buyers, with a net equity of EGP 233.75 million through February, after excluding the deals.

Trading on Bonds

In February, the volume of trading on bonds recorded around 7.148 thousand worth turnovers of around EGP 7.192 million.

Bond Trading Platform Activation in Q3

Dr. Mohamed Omran, EGX Chairman – recently announced that the launch of the bond trading platform to be delayed till the third quarter of 2014.

The postponement, according to the top official, was due to the central bank’s delay to agree on the amount of bonds that would be offered in the bourse. 
“We expect a deal in the first quarter of the year between the central bank and the main dealers on the amount of bonds that will be issued in the market,” Omran said in a press conference.

The bond trading platform could make it easier for investors to buy and sell securities on the bourse.

Sectors Activity:

Financial Services excluding Banks was the most active sector through last week, recording a volume of trades of 1.513 billion securities worth EGP 4.339 billion.

Telecommunications came second, attaining a volume of trades of 1.313 billion securities worth EGP 2.294 billion.

Real Estate reported third, with a volume of trades of 696 million securities worth EGP 3.240 billion.

Travel & Leisure sector was on the fourth position, getting a volume of trades of 553.8 million securities worth EGP 1.263 billion.

Personal and Household Products came fifth, recording a volume of trades of 438.3 million securities worth EGP 1.836 billion.

Industrial Goods and Services and Automobiles reported sixth, having a volume of trades of 408 million securities worth EGP 890.3 million.

Construction and Materials was on the seventh position, with a volume of trades of 271.1 million securities worth EGP 1.075  billion.

Food and Beverage reported eighth, attaining a volume of trades of 158.8 million securities worth EGP 1.038 billion.

Healthcare and Pharmaceuticals was on the ninth position, with a volume of trades of 64.1 million securities worth EGP 137.1 million.

Banks reported tenth, recording a volume of trades of 53.5 million securities worth EGP 1.294 billion.

Basic Resources came eleventh, attaining a volume of trades of 42.8 million securities worth EGP 604.3 million.

At the bottom of the list, Chemicals reported twelfth getting a volume of trades of 18.1 million securities worth EGP 234 million.