Benchmark index EGX-30 dropped by 2.58% to record 7,347 points, while the stock market shed EGP 8.5bn Sunday.
Egyptian and foreign traders are selling stocks while foreigners are purchasing them, the EGX indicated in an official statement.
All three indexes dropped, with the broader index EGX-100 sliding down by 2.67% and the small and medium index declining by 3.43%.
On Saturday, Banque Misr and the National Bank of Egypt (NBE) surprised the banking market by issuing savings certificates with a return rate of 12.5% annually, which is the highest return granted on savings in pounds in the Egyptian market.
Islam Abdel Atty, board member of Eg-Finance, said the drop was not “violent”.
“This is not an unprecedented rate,” Abdel Atty added in reference to the savings certificates, noting that “years ago the interest rate at banks reached 13% at banks”.
The release of these certificates might reflect on the market in the medium term, with individuals opting to invest in certificates rather than the market, Abdel Atty said. He added that the volume of trading in the stock market is not expected to drop significantly, however.
What may have influenced the market more is the news of the suspending flights and the instability of tourism at the moment, Abdel Atty highlighted.
On Friday, Russia announced its decision to suspend all flights to Egypt following the UK’s decision to suspend flights to Sharm Al-Sheikh.
Foreign Minister Sameh Shoukry slammed the UK government’s decision to suspend flights to and from the Sharm El-Sheikh, calling it a “surprising and premature decision”.
Last week, a Russian aircraft crashed in Sinai and left 224 victims dead. The Airbus A-321 plane, operated by Kogalymavia and rebranded as Metrojet, took off from Sharm El-Sheikh on its way to the Russian city of St. Petersburg before disappearing from the radars of Egyptian aviation officials.
