The United Kingdom’s (UK) decision on Friday to separate from the European Union (EU) impacted the Egyptian Exchange’s performance on Sunday with stocks dropping by 5.54% to close at 6,851.6 points.
As a result, the EGX lost any profits achieved throughout 2016, and its performance turned from a positive to a negative to register losses of 2.2% since the beginning of 2016.
The EGX lost EGP16.3bn of the market’s capital, which declined from EGP 392.6bn to EGP 376.4bn.
Trading on 69 stocks on the EGX was suspended following its decline, more than 5% of which passed during the first half-hour of trading.
The London Stock Exchange Fitts 100 index lost 3.15% of its tally on Friday, impacted by the repercussions of the British referendum.
Experts of the capital market predicted that the EGX will commence trading on Monday on a slight decline to 6,820 points, and then climb back to around 6,920 points.
EGX Chairperson Mohamed El-Aasar said the capital market reacted sharply to the Brexit outcome. The EGX welcomed Britain’s separation from the EU with a decline of 5% within minutes from the start of trading, although the losses were expected to happen during two sessions, not in minutes, said El-Aasar.
Al-Aasar added that the stock market was able to mitigate losses during the second half of the session.
He predicted that the stock market is expected to continue its session on Monday at a decline of 6,820 points, and then climb up. This is because the market had suffered all the expected losses of yesterday’s session.
Ehab Rashad, managing director of Mubasher Trade, said that the losses exceeded expectations. Although the Gulf markets are much more relevant to the UK than Egypt, they had not suffered losses as great as the ones seen in EGX, he added.
