3 business
By Reuters
CAIRO: Orascom Construction Industries posted its sharpest single-day fall in three weeks on Thursday, weighing on Egypt’s CASE 30 index as investors dumped a share that had outperformed the market.
Shares of Orascom, Egypt’s largest builder by market value, tumbled 9.35 percent to LE 184.99 ($33). The benchmark CASE 30 shed 3.50 percent to 4,716.25 points. Orascom has fallen 35 percent this year to Wednesday’s close, compared to 54 percent for the index.
“It’s one of the best performers of the year and hasn’t gone down much during previous drops, said Teymour El-Derini, trader at Beltone Financial in Cairo. “It’s catching up to the market now.
Telecom Egypt, Egypt’s fixed-line monopoly, shed 4.8 percent to LE 13.50, its first drop in four sessions.
The stock had risen 17 percent in the three sessions to Wednesday.
“People may be taking profits after the strong run, said Hashem Ghoneim, chief executive of El Nour Securities in Cairo.
Shares of EFG-Hermes, Egypt’s largest investment bank by market value, bucked the trend, climbing 9.5 percent to LE 24.90.
Investors were likely betting the share price was too low given earnings expectations, Ghoneim said.
The bank is trading at 5.29 times expected 2008 earnings, compared to a global average for investment banks of 12.62 times, according to Reuters data.
Housing stocks also surged. Medinet Nasr Housing jumped 6.32 percent to LE 25.40 and Heliopolis Housing surged 10.52 percent to LE 24.90. Heliopolis Housing is the worst-performer this year on the CASE 30 index, down 80 percent to Wednesday’s close.
“Real estate stocks have been hammered and their land banks do not justify these prices, said Mohamed Radwan, trader at Pharos Securities.
The Hermes index shed 2.93 percent to 425.40 points and the broader CIBC index fell 2.68 percent to 257.36 points.
