Reuters – Egypt’s bourse posted its biggest percentage loss in seven months on Monday as local investors continued to book profits on positions built in anticipation of former army chief Abdel Fattah al-Sisi’s run for president.
The main Cairo index tumbled 3.6% to 7,805 points, dropping for a third session in a row, as all but two of its 30 consituent stocks closed in the red and trading volume surged again after declining on Sunday.
The market has dropped 8.0% over three days. It is still up 15.1% year-to-date, having surged on hopes that Sisi, seen by many investors as the best guarantor of stability, would run in this May’s elections.
When Sisi finally did announce his candidacy last week, investors started booking profits; the move was amplified by an earnings report by EFG Hermes, which swung to a net loss in 2013 because of one-off charges.
“In this case I think we need to rely on some technical guidance,” said Chamel Fahmy of Cairo-based HC Securities and Investment. “Most technical analysts see 7,800 points as a key support level.”
Also among the sellers on Monday was private equity firm Actis, which sold shares in Commercial International Bank “in the open market to a group of international investors”, the bank said. The bank’s shares fell 4.2%.
Actis, which bought into Egypt’s biggest listed bank in July 2009 when it traded at less than a half of Monday’s closing price, sold shares equivalent to 2.6% of the bank but retains a stake of 6.5% and a seat on the board, CIB said.
