Egypt stocks continue climb as turnover strengthens

Egypt\'s main index continued its rise on Monday, gaining 0.6 percent as total turnover jumped to LE546.7 million. The market had started the trading week on a very positive note, with the EGX30 gaining 1.3 percent on Sunday, as the Central Bank of Egypt (CBE) confirmed receiving $5 billion in aid from the United Arab Emirates (UAE) and Saudi Arabia. The deposit at the CBE is part of $12 billion in aid that has been pledged by the oil-rich Gulf States of Kuwait, Saudi Arabia, and UAE. According to Reuters, Egypt\'s stocks rose to a seven-week high Sunday as work began on amending the country\'s constitution, with sentiment also buoyed that weekend protests were less violent than feared. Issa Fathy, vice president of the securities division at Cairo\'s Chamber of Commerce, attributes resilient investor confidence to their adaptation to incidents of unrest, which have become commonplace, as long as such occurrences do not affect government decision making. Egyptian and Arab investors were the net-buyers, to the values of LE74.9 million and LE28.6 million respectively, while non-Arab foreigners were net-sellers. The high turnover on Monday was due mainly to an unusual transaction on Nasr City Housing, which reached LE95.4 million in turnover, or some 17 percent of total turnover, say analysts. But there was also marked investor appetite for blue chip stocks such as Commercial International Bank, Egyptian Financial Group-Hermes Holding Company, and Palm Hills Development Company, which recorded the highest trade values in the EGX 30 index. If these levels of turnover persist, I expect the main index to break the 5,500 point resistance level, says Osama Mourad, an independent analyst and former chief executive of Arab Finance Brokerage told Ahram Online. Most of the EGX30 stocks were in the green, with Egyptian Financial Group-Hermes Holding Company rising 2 percent, and Commercial International Bank gaining 1.24 percent. The real estate sector was ascending, with Six of October Development & Investment (SODIC) up 1.64 percent, T M G Holding 0.41 percent, and Palm Hills Development Company 0.40 percent. Orascom Construction Industries, on which there is an ongoing tender offer by Dutch parent OCI NV, rose 0.08 percent, while Orascom Telecom gained 0.44 percent. The broader EGX70 index was up 0.61 percent.