Heavy selling -- or what market experts call profit taking -- has been stripping the market of some of its hard gained strength through the last two weeks. Following an upward trend that lasted from early March until the second half of June, during which the market jumped from 3,800 points to hover over the 6,000 point threshold, investors started to liquidate parts of their portfolios to realise capital gains, pushing the market down to 5,480 points by the end of last week. Market analysts believe that the retreat was also partially driven by a decline in international markets triggered by a profit taking wave in Europe and the US, and even Arab markets that were hardly hit, with Saudi Arabia losing 10 per cent of the value of its index last week. EGX30, tracking the performance of blue chips, lost 11 per cent during the week while the wider in scope EGX70 declined by seven per cent. A limited recovery took place during Monday and Tuesday, but market observers said it would be short lived. Analysts seem pessimistic about the market's performance during the coming period, some saying that the EGX30 will face downward pressure at the 5,500 level, a belief supported by the coming of July where the seasonal summer lull usually begins. On the macro level, official sources at the Suez Canal Authority expected the revenues of the waterway not to be lower than $4.73 billion in 2008/2009, registering the second highest level of revenues in its history, after generating $5.2 billion in the previous year. ORASCOM CONSTRUCTION INDUSTRIES (OCI): Orascom for Fertilisers Plant Maintenance (OFPM), a subsidiary of OCI, bought 99.99 per cent of the Egyptian Fertilisers Company (EFC) -- another OCI subsidiary -- for $10.84 per share. The move comes as a part of OCI's strategy to reorganise its fertiliser business. ORIENTAL WEAVERS (OW): The local rug company's long-term fair value was raised to LE48.3 per share by CI Capital. The move came as OW's first quarter results showed a 10 per cent increase in revenues despite the prevailing economic slowdown. "The increase came as a result of strong performance in the local market and an increasing market share in global markets. Also, improvement in the company's margins is foreseen due to the cooling-off of polypropylene prices," according to CI Capital. EGYPTIAN COMPANY FOR MOBILE SERVICES (MOBINIL): CEO Alex Shalabi was quoted in press reports as saying that the company is expecting a slowdown in mobile subscriber growth in its second quarter. In the first quarter, the number of subscribers reached 21.18 million, recording a 31 per cent year-on-year increase. Mobinil is still in the process of acquiring Linkdotnet and Link Egypt, the Internet subsidiary of Orascom Telecom (OT). Shalabi stressed that the dispute between the major shareholders of the company, namely France Telecom and OT, has not affected the operations of Mobinil, while he expected it to start having an impact if the dispute lasts much longer. TALAAT MUSTAFA GROUP HOLDING (TMG): Thabat for Real Estate Development signed a Sharia-compliant 1.4 billion Saudi Riyals financing agreement with Riyadh Bank to provide financing for buyers of units in phase one of the Nasamat Riyadh project. The project is developed by TMG and comprises of three million square metres with approximately 4,200 units north of Riyadh. The Saudi government recently prohibited off-plan sales unless real estate developers gain approval from appropriate agencies before starting sales. PAINTS AND CHEMICAL INDUSTRIES: The company's affiliate, Al-Obour Paints and Chemical Industries, has reached an agreement with British Imperial Chemical Industries, known commercially as ICI Paints Akzo Nobel, to obtain the latter's licence to manufacture ICI decorative products as well as producing new types of decorative paints and wood-care products using ICI technical information, to be sold under the trademark PACHIN. ORASCOM TELECOM (OT): The regional mobile network operator is planning to launch mobile banking services in Pakistan in July, according to the company's chairman Naguib Sawiris in a Reuters interview. He added that OT's Pakistani operation, Mobilink, would offer "m- commerce" in association with Citibank. OT is currently bidding for the Royal Bank of Scotland's Pakistani operation, he said, and "if this deal goes through it would add value to the mobile banking initiative." On a different note, OT will float 20-30 stakes of its Tunisian and Algerian operations in 2009 and 2010 respectively. CI Capital estimated the expected revenues from floating the shares to range between $2-3 billion. On another front, Italy's Wind, which is 100 per cent owned by Weather Investments, launched 2.7 billion euros worth of bonds maturing in 2017. According to Dow Jones, this will be Europe's largest junk bond offering since October 2006. OT's chairman, Naguib Sawiris owns a majority stake in Weather Investments. Compiled by Sherine Abdel-Razek
