The downwards trend in the Egyptian Exchange (EGX) benchmark index EGX-30 is expected to continue unless the market sees some “good news”, technical analysts told Daily News Egypt.
Mohamed Al-Assar, head of the technical analysis department at the National Bank of Kuwait (NBK) for investment in North Africa and the Middle East, expected the index to range between 5,650 points and 5,950 points.
Al-Assar added that the decline in the benchmark index is predicted to continue throughout the first quarter of 2016, stating that the trend of losses which started January will affect indices in the medium term.
Head of Technical Analysis Department at Naeem Brokerage Ibrahim El-Nemr said the market is expected to undergo some fluctuations and declines, ranging between 5,300 and 5,650 points.
He added, however, that “good news, such the closing of OTMT’s [Orascom Telecom Media and Technology Holding] acquisition of CI Capital” can reflect positively on the index.
The closure of the deal might lead to the index surging from 5,900 points to up to 6,300 points, El Nemr added.
Over the past week, EGX-30 dropped by 6.26%, closing at 5813.54 points compared to the 6202.22 points at which it opened the week. The broader index, EGX-100, decreased from 696.4 points to 708.61 points, a 1.72% drop. Small and medium enterprises index EGX-70 inched down by 0.57% and closed the week at 349.46 points.
A total of 324.7m telecommunications shares were traded throughout the week, at a total value of EGP 244.3m. Last week, the value of shares traded in the sector totalled EGP 240.3m. A total of 284.6m real estate stocks were traded, at a value of EGP 870.6m.
The value of financial services shares, excluding banks, recorded EGP 266.7m while the value of banks shares traded registered EGP 352.3m.
The total value traded recorded EGP 6.9bn, while the total volume traded reached 1bn securities, executed over 100,000 transactions during the past week, the report said.
During the week beginning 6 January, the total value traded amounted to EGP 4.4bn. The total volume traded during the same week reached 1.03m shares, executed over 111,000 transactions.
Egyptians dominated the past trading week, controlling 94.5% of the trade movement in the EGX.
Foreign investors accounted for 2.56% of the trade movement, while Arab investors controlled 2.95%, the report said. Non-Arab foreign investors were net sellers, with a net equity of EGP 2.16m, as were Arab investors, with a net equity of EGP 11.7m.
The EGX further stated that since the beginning of the year, non-Arab foreign investors were net sellers, with a net equity of EGP 639.7m. Arab investors were net buyers, with a net equity of EGP 282.25m.
“During this week, institutions accounted for 78.96% of the value traded, while the remaining 21.04% were for individuals,” the EGX report said.
“Institutions were net sellers during this week, with a net equity of EGP 174.71m,” it added.
The total market capitalisation of the listed stocks amounted to EGP 386bn at the end of last week, representing a 4% drop compared to the preceding week.