The Egyptian Exchange (EGX) has achieved remarkable gains in the past month, breaking historical records and surpassing the 18,800 points level. Analysts expect the market to continue its upward trend despite some profit-taking, driven by positive news and strong corporate results.
EGX30, the benchmark index of the market, closed at 18,885 points in August, up by 7.26% from July. EGX70 EWI, which tracks small and medium-sized stocks, rose by 8.46% to 3,829 points. The capped EGX30 index increased by 6.29% to 22,708 points, and the broader EGX100 index grew by 7.28% to 5,597 points.
Adel Abdel Fattah, the chairperson of Egyptian Arabian Company – Themar, said that the market was influenced by the positive news of Egypt’s invitation to join the BRICS group, which reflects the confidence in the Egyptian economy’s ability to overcome crises. He also said that the exceptional financial results of the listed companies were one of the reasons for the market’s rise.
Abdel Fattah expected that the market would witness some correction and profit-taking in the coming week, but advised investors not to fear the declines. He added that some sectors, such as fertilizers and real estate, would lead the market’s growth in the coming weeks, as they have shown positive results and high sales volumes. He predicted that the EGX30 index would reach 19,700 points shortly.
The market witnessed trading values of about EGP 72bn in August, through 18.7 billion securities and 1.8 million transactions. The market capitalization of listed shares increased by 7.19% to EGP 1.276trn.
Moataz Ashmawy, the managing director of Arabeya Online, said that the market witnessed strong rises in both the main index and the small and medium-sized stock index, driven by the expectations of a movement in the exchange rate. He pointed out that the rise of Commercial International Bank (CIB), which has the highest weight in the EGX30 index, contributed significantly to the index’s rise. He expected that other leading stocks would follow suit and push the index to 19,600 points in the coming weeks.
Ashmawy said that some sectors, such as banking, non-banking financial services, and real estate, would continue to lead the market’s rise and reach historical levels.
Foreigners recorded net purchases of EGP 156.8m in August, while Arabs recorded net purchases of EGP 367.6m. Shares accounted for 80.87% of transactions on the EGX in August, while bonds accounted for 19.13% of transactions.
