Market Report: Egypt's bourse edges up on resurgent foreign trade

A late rally in investor interest staves off bad telecoms news to push all indexes into the green

A resurgence in trading activity pushed Egypt's stock benchmark up 0.61 per cent on the last day of the Easter holiday week, despite disappointing news from the telecoms sector.
The EGX30's mild gain was echoed by a 2.6 per cent rise in the broader EGX70, as market turnover climbed to LE840.8 million, more than double Tuesday's figure.
Walaa Hazem, financial analyst with HC Securities, said Thursday's upward movement was not significant, but other market signs were very encouraging.
"The markets are so volatile these days that you can't really speak of a real bullish attitude, as you can't find real reasons that can either push the purchasing power of the market either upward or downward," Hazem told Ahram Online.
Foreign traders made a strong showing, representing nearly 60 per cent of the market -- double the average of the previous two weeks.
"That's really positive and may be an indication that the market is regaining the trust of investors, given that foreigners have [thus far] been sticking to the sidelines since the bourse's reopening," adds Hazem.
Institutions rallied too, making up 72 per cent of stock trades.
Of 187 listed stocks, 131 showed gains and 41 declined.
Telecoms was the only sector to finish in the red, a fact analysts attribute to disappointing first-quarter results released by Egyptian mobile phone operator, Mobinil.
Mobinil said in its earnings statement that "political turmoil and economic uncertainty hurt first-quarter results, sending net income tumbling 93.6 per cent year-on-year".
Mobinil finished trading 3.45 per cent down.
"Investors have been awaiting Mobinil's results as the first major indication of how the political unrest that hit Egypt would affect the whole sector, and when the results were far below expectations, this affected the whole sector in the bourse," says Mohamed Hamdi, telecoms analyst with CIBC brokerage company.
Hamdi expects earnings of other telecoms companies to face a similar fate due to the week-long period starting 28 January when Egypt cut off most internet and mobile phone services as the revolution escalated.
"Cutting services during the political turmoil has severely affected the sales of telecom companies," he adds.
"When the companies didn't respond immediately and in a positive way to compensate customers for the harm they were caused, people were disappointed and cut their mobile use to a minimum."
The day's biggest gainers were in the petrochemical sector, with Egyptian Chemical Industries rising 10 per cent and Kafr El-Zayat Pesticides continuing last week's strong performance to climb 9.51 per cent.
There was a surprise, too, when stocks in El Ezz Aldekhela Steel -- part of the empire of detained tycoon Ahmed Ezz -- climbed 6.8 per cent.