Struggle and chaos    Let the league begin    Road to redemption    My visual diary    The ambassadors of Cleopatra    Egypt's food exports increase 2.2% to record $1.8bn in H1-20    Asia stocks mostly rise, Hong Kong jumps 2%    Egypt's 2020 Thanaweya Amma exams results announced    Researchers say UK faces a Brexit brain drain to the EU    Egypt's mortgage finance activity finance declines 84.2 % in April    New Dutch coronavirus cases spike in past week: Health authorities    Leather products sales in Egypt see 25% increase during Eid al-Adha    Emaar Misr, El Sewedy Education sign MoU to establish Knowledge Hub Universities in New Zayed    Australian club that gave Bolt trial face uncertain future    Nigerian airline sacks pilots, cuts pay over virus hit    African activists fight violence against women one law at a time    Egypt's single-day new Covid-19 cases count continues to drop    Napoli confirm Insigne injury ahead of Barcelona clash    Record temperatures, pending deals inflame Iraq's power woes    Centamin earnings jump on strong gold prices, higher Egypt mine output    Heavy rains hit eastern China from weakening tropical storm    Egypt says Turkish survey in Mediterranean a violation of sovereign rights    Kuwait to review suspension of flights from Egypt – ministry    Egypt's Sisi congratulates UAE on its first Arab nuclear power plant    Egypt invites Tesla's founder to visit Giza Pyramids after controversial tweets    Sisi: Egypt favours negotiations over a military solution to resolve Nile dam crisis: Al-Sisi    Egypt rejects unilateralism compromising right to Nile water, Sisi tells South African counterpart    No room to delay Egyptian Premier League games – EFA's board member    Egypt's National Elections Authority released on Friday a tutorial video for Egyptians for how to vote in the upcoming senate elections due to coronavirus pandemic    Egypt's President Sisi ratifies extending state of emergency for 3 months    Egypt's Sisi extends state of emergency for three months    Egypt Cup games to resume after Premier League finishes: EFA    The Facebook Preacher's Search for Fame, and Egypt's Economy    Egypt economically strong in face of COVID-19, reforms ongoing: International Cooperation Minister    Arafa Holding reports $144,000 COVID-19-related losses in April    Egypt's efforts in Libya to activate free will of Libyan people: Al-Sisi    Egypt calls on UNSC to address oil spill risks off Yemen coast    Hyksos campaigns were internal takeover, not foreign invaders: study    Reports over Ethiopia filling mega-dam    Foreign player numbers in Egyptian Premier League clubs to not change next season    COVID-19 affects Egypt sporting clubs    COVID-19 will soon turn to seasonal like swine flu: Presidential Health Advisor    ‘Egypt's Support' coalition convenes to discuss its Senate election list    Robbery attempt leads to discovery of Ptolemaic monuments in Qena    Flouting international guidance, Ethiopia unilaterally starts filling its Nile dam    Google ‘translate' ancient Egyptian hieroglyphs    Zaha speaks out after online racial abuse    Farwell to 74-year old Egyptian military production minister El-Assar    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.





Egypt shares to extend upwards trajectory as CBE seen cutting interest rates
EGX30 records best weekly gains since December 2016 in heavy trade
Published in Daily News Egypt on 11 - 03 - 2018

Egypt shares are expected by analysts to keep their rally alive as the Central Bank of Egypt (CBE) is seen cutting interest rates at a faster pace, with inflation falling to its targets.
"The market will keep its rally alive in the medium-term. There is lots of stimulus that could help in incurring more foreign inflows in the few coming weeks," analyst Sameh Gharib of The Roots Stock Brokerage House said.
Gharib also noted that initial public offering (IPO) activity could serve as another boost to the market in the long run.
Last week, Egyptian Exchange (EGX) Chairperson Mohamed Farid said that the market could see seven fresh IPOs this year.
In an interview with Bloomberg, Farid added that the first IPO will be launched this month and the second will take place in April.
Another four or five IPOs are scheduled to be launched on the EGX prior to the end of 2018, he noted, giving no further details on the names of the firms that will make share sales or the sectors they belong to.
"As we see, the inflation records are falling towards the CBE targets, which means more interest rate cuts will be on the cards," Gharib confirmed.
Egypt's headline inflation rate—which covers urban consumers only—was down from 17.1% year-over-year in January and a peak of 33.0% y-o-y in July last year.
"Today's reading means that inflation is now within the central bank's target range for the end of this year of 13% ±3%," Capital Economics said in a recent research note.
"We think today's data will be enough to persuade Egypt's Monetary Policy Committee (MPC) to cut interest rates again when it next meets on 29 March. The MPC embarked on an easing cycle last month, lowering its benchmark overnight deposit rate by 100 basis points (bps), to 17.75%, and we expect this to be followed up with another 100 bps reduction this month," the report added.
The report also noted that the central bank's efforts to improve its inflation-fighting credibility mean that a series of very sharp rate cuts is unlikely.
"But that does not rule out a substantial and prolonged easing cycle. Overall, we anticipate the overnight deposit rate ending this year at 13.75%, whereas the consensus expects it to fall to 14.25%," it added.
The CBE cut its overnight deposit and lending rates by 100 basis points on 15 February to 17.75% and 18.75% respectively.
"Its main operation and discount rates were also cut by 100 bps, to 18.25%. The CBE had increased rates by 700 bps since devaluing the Egyptian pound in November 2016," Fitch Ratings noted in a report.
Meanwhile, economist Safaa Fares said that the EGX is likely to maintain the bullish trend and extend gains on the back of purchasing power of local institutions.
The benchmark EGX30 index has resistance at 16,100 points and an upside potential at 16,400 points, while it has support at 15,750 points and a downward potential at 15,500 points, Fares highlighted.
Moreover, the EGX70 index has resistance at 890 points and an upside potential at 920 points, while it has support at 875 points and a downside potential at 866 points, she added.
For her part, 3Way Finance Chairperson Rania Yacoub said that the EGX30 index was able to break resistance above 16,000 points last week, backed by the remarkable financial results of major firms, mainly real estate and petrochemical firms.
Yacoub projected the EGX to extend gains and hover around 17,000 points before mid-2018.
EGX30 records best weekly gains in more than a year
The Egyptian Exchange (EGX) saw a very positive performance in the week that ended Thursday 9 March, supported by foreign investors' purchases.
The benchmark index EGX30 rose 6.61% and closed at 16,742 points, seeing traded volumes of 991m shares, with a turnover of EGP 5.9bn.
As for market capital, it gained a total of EGP 65.5bn, closing at EGP 957.9bn, compared to EGP 892.2bn last week.
Small and medium enterprise index EGX70 rose 0.64% to 861.59 points, while the broader index EGX100 gained 2.87% to 2,220 points, and the equal-weighted index EGX50 also went up by 3%.
Market analyst Michael Mamdouh Naguib said in a research note that the Egyptian Exchange was able to reach a new peak.
Meanwhile, Beltone Financial Holding reported turning to losses in 2017 due to an increase in salaries and commissions.
Net loss amounted to EGP 14.25m last year, compared to a net profit of EGP 44.27m in 2016, including minority shareholders' rights, the company said in a filing to the Egyptian Exchange (EGX).
Revenues climbed to EGP 696.7m in 2017, versus EGP 231.05m a year earlier.
The company attributed the 2017 loss to salaries that rose to EGP 303m from EGP 90.16m, in addition to losses from execution commissions in foreign markets which amounted to EGP 171.9m last year.
Standalone losses stood at EGP 12.008m last year, against profits of EGP 37.7m in 2016.
The main index saw a return of purchasing powers, which helped push its gains, according to analyst Gharib of Roots Stock Brokerage House.
Gharib added that EGX recorded a meteoric rise in volume last week driven almost entirely by record-setting foreign institutional trading.
In the cement sector, the financial indicators of Suez Cement showed an 80.9% y-o-y hike in consolidated losses for the full year 2017.
Net loss stood at EGP 1.13bn last year, up from EGP 629.3m in 2016, the company said in a filing to the EGX.
Sales increased to EGP 6.46m in 2017, compared to sales of EGP 6.14m a year earlier, the EGX-listed firm said.
Meanwhile, standalone losses grew to EGP 441.7m in 2017, versus EGP 215.59m in the prior year.


Clic here to read the story from its source.