Egypt's stock market encountered weekly heavy losses worth 40.8 billion Egyptian pounds (US$5.2 billion) sparked by Fears of a China-led global economic slowdown in addition to local incidents affecting a number of leading listed firms. The country's main stock index, EGX30 hit its lowest level since January 2014, it plunged 9 percent to close at 7172.63 points, versus 7879 points at the end of a week earlier. The main gauge index registered its highest point on Sunday closing at 7625.76 points, whereas its lowest point recorded on Thursday at 7172.63 points. In addition, the mid- and small-cap index, the EGX70 sank in a week by 7 percent closing at 410 points during Thursday's session, compared to 441 points at the end of a week earlier. The price index, EGX100 also dived 6.4 percent finishing at 862 points during Thursday's session, from 921 points at the end of a week earlier. Market Cap Market capitalisation ended at 444.068 billion pounds last Thursday, compared to 484.908 billion pounds at the end of a week earlier. Turnovers Through last week, the trading volume hit around one billion securities, compared to 693 million. For the traded value, it reached 4.7 billion pounds against 3.1 billion pounds a week earlier. China Fears Anxiety about China-led global economic slowdown gripped investors around the globe. Fears that Chinese growth is weakening, dragging down the global economy with it, are already hammering commodities and world stock markets. Skittish investors are now pinning their hopes on urgent policy action by Chinese authorities to stem the global bleeding, after the country's manufacturing activity slumped to a six-year low and accelerated selling in global markets. Markets will be watching for China's next move as signs of a slowdown in the world's second-largest economy stack up, raising expectations it will act to stoke growth. On Friday a survey showed Chinese manufacturing slowed the most since the global financial crisis in 2009 - adding to other worrying clues about the country's health, including its falling exports. China devalued the yuan earlier in August, by pushing its official guidance rate down 2 percent. The central bank has said there was no reason for the currency to fall further, but investors are also bracing for further interest rate cuts. Market Remarks - Juhayna's official confiscation crisis The Judicial committee assigned to count and manage funds belonging to the Muslim Brotherhood announced Thursday, August 13, 2015, a decision to freeze the assets of Juhayna Food Industries CEO Safwan Thabet. The decision excluded Juhayna, which is Egypt's top dairy company, and it is unlikely to be affected by the move against its CEO. However, UK-based Abderdeen Asset Management raised its stake in Juhayna Food Industries to 5.08%, up from 4.38%, the company said in last Thursday statement. Thabet is accused of being affiliated with the outlawed Muslim Brotherhood, as he is a relative of a former supreme guide of the group. Juhayna Food Industries shares plunged after their chief Safwan Thabets assets were confiscated. Eissa Fathy, the managing director of a Cairo-based securities firm described news related to the confiscation of the assets of Juhayna's chairman Safwan Thabet as one of the "sparks" for the stock market's dive. - Oriental Weavers' ‘Monopolistic Practices' allegations The state's competition authority referred Wednesday carpet manufacturing giant Oriental Weavers to prosecutors for being accused of "monopolistic practice". This procedure was taken after it was proven that the company has broken the law, Chairman of Egypt's Competition Authority Mona al-Garf told Aswat Masriya over the phone. Earlier on Wednesday, Oriental Weavers denied that it was referred to prosecutors, in a statement to Egypt's stock exchange. The carpet manufacturer added that the letter sent to Oriental Weavers by the authority only tasked the company with resolving its violation within 15 days. The company attached the authority's letter, which had no mention of the referral to prosecutors. Garf, however, said the authority itself is not obliged to inform the company of its referral to prosecutors and the prosecution will summon company officials for investigation. - Amendments to Capital Gains Tax in two weeks Egypt will start lowering the tax ceiling for companies and individuals in high income brackets and freeze a 10 percent tax on capital gains within two weeks, Finance Minister Hany Dimian told Reuters Thursday. "We await the issuing of the amendments ... within a few days; one or two weeks at the most," he said.
