EGX rose to 5% at end of Q1 2017

The Egyptian Stock Exchange (EGX) ended the first quarter of this year by the rise of its main index by about 5.2%, amid optimism regarding the improvement of the market during the second quarter of 2017, with expectations of interest rate cuts in the future, in conjunction with the new initial public offerings (IPO) that will start with MM Group.

Receiving and registering the IPO’s orders for the shares of the MM Group for Industry and International Trade will start on Sunday in the EGX at a maximum of EGP 6.06, starting from the session of 2 April.

The public share of the IPO includes 15% of the total offering at a 4.5% ratio by 17.8m shares from the total shares of the company, compared to 85% for the private share of the IPO by 25.5%, including 100.9m shares from the shares of the company’s capital.

The market disregarded distributions of profits of EFG-Hermes at EGP 2.75 per share, and the share declined to the levels of EGP 25.9 at the end of the trading session last week.

Ahmed Abou Taleb, managing director for the brokerage sector at Pharos Holding for Financial Investments, said that the distributions of EFG-Hermes’ profits were expected in light of the rising profits after the company deals.

He pointed out that the EGX showed a significant correlation with the movements of the dollar since the flotation the pound.

In terms of technical movements of the market, Mohamed El-Aasar, head of the technical analysis department at Watany Capital Securities Brokerage, said that the main index of the EGX moved towards levels of 14,500 points during the second quarter.

He pointed out that any interest rate cuts during the quarter would accelerate the pace of the rise of shares.

He stressed on the positive movements of the leading shares during the second quarter, especially, the Commercial International Bank (CIB) share, which targets EGP 9, as well as shares of Ezz Steel, Talaat Moustafa, Hermes, and Madinet Nasr for Housing and Development (MNHD).

According to the report of the technical analysis of the investment bank CI Capital, the main index of the market is moving between the 12,750-point zone and the zone of ​​13,190 points.

The index stabilisation above the 11,800-11,500 point zone is lifting the positivity of the market. The next target will be at the 13,500-13,540 point zone.

The performance of the EGX70 index excelled during the current trading period, as the index broke through the 530 point zone, targeting the 555-560 point zone.

On the weekly level, the main index of the stock exchange, EGX 30, rose 0.29%, or 37.26 points, to the level of 12,994.8 points.

The EGX70 index rose during the week by 1.46%, or 8.19 points, to 569.69 points.

The EGX100 index rose by 1.35%, or 17.75 points, to the level of 1,327.74 points, while the EGX50 rose by 0.92%, or 18.93 points, to the level of 2,071.13 points.

The market capital of the EGX increased by EGP 1.78bn during the week, closing at EGP 654.97bn, compared to EGP 653.19bn in the closure of the previous week.

In March 2017, the market capital of the EGX increased by EGP 66.16bn to close at EGP 654.97bn, compared to EGP 588.81bn in the February’s closure.