Egyptian stocks followed global markets down on Tuesday, traders said. World stocks fell and the euro slipped closer to a four-year low against the dollar as expectations that slowing growth in China and the eurozone would hamper the global economic recovery hit risky assets. EFG-Hermes, Egypt's largest investment bank by market value, led declines, falling by 4.5 per cent to LE29.06 ($5.1) per share. Orascom Telecom, the largest Arab mobile operator by subscribers, fell by 1.92 per cent to LE6.14 per share. Orascom Construction Industries, the country's largest builder by market value, slid by 2.04 per cent, closing at LE238.67 per share. The North African country's benchmark index EGX 30 shed 1.7 per cent, ending the day's trading at 6,437.79 points. The EGX 70 index, which measures 70 of the country's small and mid caps, plunged by 1.69 per cent to 556.65 points. Arab and non-Arab investors made net sell-offs worth LE26.4 million and LE61.8 million respectively. Volume hit LE824 million, according to the Egyptian Exchange. European stocks fell more than one per cent in the first hour of trading, with BP losing as much as 15 per cent after its attempt to plug a disastrous oil leak in the Gulf of Mexico failed, Reuters reported. "There is very little reason at the moment for people to be adding more risk," said Justin Urquhart Stewart, director at Seven Investment Management. The Morgan Stanley Capital International (MSCI) world equity index fell 0.9 per cent on the day. The index lost nearly 10 per cent since April, putting it on track for its biggest quarterly loss since March 2009. The FTSEurofirst 300 index fell 1.7 percent while emerging stocks lost 1.9 percent. The dollar rose 0.6 per cent against a basket of major currencies while the euro fell one per cent to $1.2175, around half a cent above the four-year low it hit last month. The single currency has been under pressure as concerns grew that the region's sovereign debt problems and slowing growth will usher in a new round of writedowns for the banking sector. The European Central Bank warned on Monday that euro zone banks faced up to 195 billion euros ($239 billion) in a "second wave" of potential loan losses over the next 18 months due to the financial crisis, and said it had increased purchases of euro zone government bonds. "The situation remains difficult for the euro," Commerzbank said in a note to clients. "Concerns about the consequences of the savings measures that have been initiated in many countries demonstrate how bad sentiment for the joint currency currently is." Underlining contagion risks from the euro zone crisis, China warned on Monday that global growth remained vulnerable to sovereign debt risks and the possibility of a second downturn. Such global growth concerns weighed on oil, with U.S. crude oil losing 1.9 percent to $72.58 a barrel.
