Egypt's stock market saw one of its worst trading days for a month as a series of disputed statements involving the Egyptian currency and potential military action in Syria sent investors running for the exits.
The benchmark EGX30 plunged 3 per cent to 5,650 points by the close of Monday trade, weighed by heavy losses for some of the Bourse's key stocks. From the 185 shares traded on the exchange, just 12 gained in value while 166 declined. One market analyst said that a televised interview with Egypt's finance minister last Friday had undermined investor confidence. Interviewed last Friday, Momtaz El-Said said the International Monetary Fund had demanded the government devalue the Egyptian pound in order to qualify for a long-awaited $4.8 billion loan. The minister's words contradicted previous pledges made by the Cabinet. "[El-Said's statement] led investors to really doubt the credibility of the government," said Mostafa Badra, a capital market expert. "It was the first time in three months that we didn't take any orders, either to buy or sell, for around 90 of the stocks traded." Also rattling nerves was a report that an aide to President Mohamed Morsi had said Egypt was seriously considering a Qatari proposal for Arab military intervention in Syria to end the country's 18-month-long conflict. The report, carried by Turkey's state-owned Anatolian news agency, was later denied by the presidential office. Nevertheless, it sent a shiver of panic thorough investors, Badra believes. The effect was muted on Sunday thanks to limited foreign trade, but was fully felt on the first day of the Western trading week. Every stock in the EGX30 finished in the red, led down by heavyweights Orascom Construction Industries, Commercial International Bank and Orascom Telecom, which tumbled 2.5 per cent, 2 per cent and 3.7 per cent, respectively. The property sector saw some of the heaviest losses, with the Talaat Mostafa Group, Six of October Development & Investment and Palm Hills plunging 4.5 per cent, 7.6 per cent and 6.4 per cent, respectively. The broader-based EGX70 slipped a yet-greater 4 per cent. Egyptians and non-Arab foreigners were the day's net-sellers to the tune of LE4.5 million and LE36.6 million respectively. Daily turnover was LE850.4 million ($139.45m).