Expectations for the stock market to recover this week after a quiet start of the new year


The Egyptian Stock Exchange witnessed quiet trading during the past week, but traders expect that the stock exchange will receive positive news that pushes the main index to exceed the index’s range of movement recently.

The main index “EGX30” closed up by 0.99% during last week’s sessions, ending on Thursday, to close at 10952 points, and the broader EGX100 index rose by 0.88% to 3125 points.

The “EGX70 EWI” index for small and medium stocks rose by 0.35% to close at 2152 points, and the “egx30 capped” index rose 1.41%, closing at 13432 points.

Adel Abdel Fattah, Chairman of the Board of Directors of Themar Securities Brokerage Company, expected that calm will dominate the financial market transactions during the first half of this month of January, provided that the transactions will witness a big boom by the end of the month, supported by the positive movement of the leading stocks.

Abdel Fattah suggested that the main index of the Stock Exchange would gradually target the level of 11,500 points, to support the expected recovery in the real estate sector, especially for some stocks that are still trading at less than their fair value, such as “Nasr City”, “Heliopolis Housing”, in addition to “Palm Hills”.

Abdel Fattah advised small investors to stay away from speculation in order to preserve their gains, and to enter the leading stocks.

The market capital reached 660.2 billion pounds during the week, up 1.43% from the previous week, which amounted to 650.9 billion pounds. Shares accounted for 54% of the total trading value, while bonds grabbed 46% of trading.

Mona Mostafa, trading manager at Arabiya Online Securities, said that the first half of last week witnessed a lull in trading, followed by the rise of the index, approaching the level of 11,000 points, with little profit taking for some positions.

She explained that the dealers tended to discount the profits achieved, even if they were marginal, indicating that the positive news will lead to the emergence of buying operations on the leading stocks.

And she added that investment managers see a risk looming on the horizon due to fear of the continued rise in gold prices, noting that the opportunity to invest in stocks will become weak.

Mustafa suggested that the market will move casually between the levels of 11000 and 11400 points during the current week, explaining that the market is waiting for increased liquidity rates and the entry of new liquidity in the leading stocks to confirm the upward trend.

It advised the long-term investor to take cumulative positions in stocks that are able to maintain their support.

The market recorded a trading value of 9.1 billion pounds, through the circulation of 1.4 billion shares, through the implementation of 159 thousand buying and selling operations, compared to deals worth 11.8 billion pounds at the end of the previous week, on 2.5 billion shares executed through 202 thousand operations.

Egyptians accounted for 84.6% of transactions on the stock exchange, while foreigners accounted for 9.1% and Arabs accounted for 6.3% after excluding deals.

Foreigners recorded a net purchase of 96.5 million pounds by the end of the week’s transactions.

The article expects the stock market to recover this week after a quiet start to the new year, it was written in Al-Borsa newspaper.