Market Report: Real estate gains power Egyptian stocks up for fifth day

Surprise surge in battered sectors continues the Bourse's rally but analysts expect slowdown in coming week

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Unexpected rallies in real estate and tourism tempered investor caution over ongoing unrest to ease Egypt's stock benchmark up 1.14 per cent, finishing Sunday at 5,062 points.
It was the fifth consecutive day of gains for the EGX30, rebounding from last Sunday's two-year low prompted by Muslim-Christian clashes in Cairo.
“Sectarian clashes over the weekend had a minor effect on today's trade with the EGX30 index staying above the 5,000 points mark. It was a normal Sunday, coupled with low volumes,” said Omar Darwish, an equity trader at CI Capital Holding.
Of 182 listed stocks, 143 gained and 33 declined in LE367.1 million worth of stock trades, a figure substantially below the LE600m post-Mubarak average due to the Sunday closure of overseas markets.
All sectors either ended in the green or held their value.
Leading the charge, to the surprise of market-watchers, were real estate and travel and leisure, gaining 4.15 and 6.6 per cent. Both sectors had plunged since the Egyptian stock market reopened in late March, influenced by the sharp decline in tourism and ongoing corruption cases involving disputed land.
But a smattering of favourable news among affiliated companies may have sparked a broader rally, say analysts.
Shares in Egyptian Resorts soared 9 per cent on rumours that Egypt's military prosecutor had released former board member Ibrahim Kamel from detention. Kamel had been held for questioning after being accused of inciting violence against anti-government protesters during Egypt's uprising.
However, after the market closed on Sunday, reports said Kamel had been rearrested and remanded in custody for a further 15 days pending investigation.
Meanwhile, luxury resort developer the Amer Group, smarting from recent losses of land in northwest Egypt, also finished up 7.34 per cent following its board's approval of a new project in Turkey.
Such rallies may have spurred a wider appetite for real estate as shares in beleaguered property developer Palm Hills Development gained 6.37 per cent and the similarly embattled Talaat Moustafa Group climbed 5.34 per cent before close of trade.
Investment bank Pioneer Holdings also finished up 7.39 per cent after relatively high trade.
Losses were mild, with food producer Bisco Misr seeing the largest drop – 5.58 per cent -- despite the release of first quarter results showing a 79.2 per cent year-on-year climb in net profits.
With foreign markets closed, Egyptians were responsible for the vast majority of trade – 84.9 per cent – and were net-buyers to the tune of LE40.4m. Foreigners comprised 12.18 per cent of the market and were net-sellers
Individuals crowded out investors to make up 66.4 per cent of trade, their interest in lower-cap, riskier investments edging the broader EGX70 index up 1.56 per cent.
Analysts said the market's rally might stall this week, as individuals look to quickly capitalise on recent gains.
“The market is still very weak in volume and with low participation of local institutions,” said Nael Sedqy, an equity trader at Naeem Brokerage. “We might see some slowing down of the market due to profit-taking over the next few days.”