Cairo shares slip on profit-taking and rumors

Published May 30th, 2001 - 02:00 GMT

CAIRO, (Reuters) - Cairo shares slipped on Tuesday, May 29, on profit-taking and rumors about a delay in Egypt's entry into the Morgan Stanley Emerging Markets Free index, scheduled to take effect as of the close of May 31, traders said. 

 

"The rumor is that Egypt will not enter the Morgan Stanley index as of June. People are scared that it's true," said Mohamed Nader, board member at Global Capital Group. 

 

An MSCI spokesperson said it had made no announcement to that effect. 

 

Traders were also concerned about the possible impact on stocks of allegations of corruption and mismanagement made by a member of parliament against the Egyptian stock exchange. 

 

"This will have a negative effect on clients. Not all clients have a good understanding of the situation. They just know that something is wrong," said Ehab Tomoum, broker at Al-Shorouk Brokerage. 

 

Other traders said the allegations might affect the bourse's credibility, but should not have an impact on stocks. 

 

A committee set up by Prime Minister Atef Obeid will look into the allegations, a bourse spokesman said on Tuesday. 

 

Asked about newspaper reports detailing the allegations by People's Assembly member Kamal Ahmed and complaints by investors, bourse spokesman Ayman Salah said: "There is a committee being set up by the prime minister." 

 

"We welcome that. We welcome anyone who wants to look into the allegations. We have nothing to hide," Salah told Reuters. 

 

The benchmark Hermes Index closed down 97.82 points, or 1.4 percent, at 6,688.26 and the broader CIBC Index lost 0.39 points, or 0.6 percent, to end at 70.15 points. 

 

Analysts said most of the profit-taking activity occurred in Lakah group and Media Production City. 

 

Lakah dropped 0.05 pounds, or the five percent limit, ending at 1.03 pounds with 7,028,261 shares changing hands. 

 

Media lost 0.7 pounds, or 4.9 percent, to close at 13.63 pounds on volumes of 598,680 shares. 

 

"Media's decline today was due to profit taking as it had risen to a new price level yesterday at 14 pounds," Global's Nader said. 

 

Cements fared no better amid a continued dearth of fresh news regarding stake sales. Latest company information from Suez Cement affirmed the tender expiry date for its 25 percent stake sale was still set for June 7. Suez had earlier postponed the auction's expiry to June 7 from April 9. 

 

Suez ended down 0.37 pounds, or one percent, at 36.3 pounds with 71,816 shares changing hands. Helwan Cement fell 0.66 pounds, or 1.9 percent, to 34.55 pounds, on volumes of 66,776. 

 

Main market drivers telecoms also reflected an overall glum mood. 

 

Orascom Telecom closed down 0.58 pounds, or 1.8 percent, at 31.58 pounds on volumes of 93,582 shares. Egyptian Company for Mobile Services (MobiNil) shed 2.06 pounds, or 2.9 percent, closing at 70.36 pounds with 83,572 shares changing hands. ($1=3.88) Egyptian pounds  

© 2001 Mena Report (www.menareport.com)

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