As the Eid al-Fitr holiday nears, the Egyptian Exchange (EGX) is bracing for a potential short-term dip in trading activity. Despite a surge of optimism from a strong performance in the previous week’s final session, market participants are gearing up for expected fluctuations.
Last week, the EGX’s primary index, the EGX30, saw a 3.44% increase to 28,506 points, while the EGX70 EWI ascended by 1.28% to 6,481 points.
The EGX30 Capped experienced a 3.82% rise to 34,845 points. Similarly, the comprehensive EGX100 index grew by 1.65% to 9,229 points, and the S&P index appreciated by approximately 2.73% to 5,706 points.
Bassem Abu Ghaneima, Head of Technical Analysis at Arabeya Online, posits that the main index might challenge the resistance levels of 29,500 and subsequently 30,000 points in the near term, provided the buying momentum surpasses the selling pressure.
Abu Ghaneima observed that the index fluctuated between 27,000 and 28,500 points in the previous week’s trading, suggesting a continued corrective trend unless buyers can decisively outpace sellers. He recommends that short-term traders and speculators engage in swift transactions while advising those with medium to long-term investments to await the end of the corrective phase and to capitalize on the upward trend to minimize marginal positions.
Last week, the EGX saw trades totalling around EGP 13.9bn, involving 2.8 billion shares across 434,000 transactions. This is in contrast to the previous month’s EGP 16.8bn worth of trades, comprising about 3.4 billion securities over 503,000 transactions. The market capitalization of listed companies increased by 2.5% to EGP 1.905trn.
Domestic investors were responsible for 81.8% of the total trading volume of listed stocks, with foreign and Arab investors making up 11.8% and 6.5%, respectively, excluding deals. Foreign investors netted purchases of EGP 389m, while Arab investors netted sales of EGP 424m.
Since the start of the year, excluding deals, Egyptian transactions have constituted 88.4% of the trading value of listed stocks, with foreign and Arab investors accounting for 5.2% and 6.4%, respectively. Foreign investors have netted purchases of approximately EGP 2.8bn, while Arab investors have netted sales of about EGP 1.56bn, all on listed stocks.
