CAIRO: Egyptian investment bank EFG-Hermes helped drag Egyptian stocks down on Wednesday as retail investors sold ahead of a planned capital increase, traders said.
The benchmark Hermes index fell 2,560.24 points, or 3.7 percent, to 66,042.04 points. The broader CIBC index ended the session down 2.7 percent at 271.86 points.
It s mainly small retail investors who are selling EFG because they don t want to be involved in the issue of new shares, said Mohamed Kotb of Prime Asset Management.
Most of the retail investors bought EFG because they thought it would rise in the run-up to the deadline … They weren t interested in the actual issue, another trader said.
The traders said the deadline for taking part in the issue was Thursday, when investors had to hold the stock to qualify to apply for the new shares.
EFG-Hermes, one of the Egyptian bourse s most heavily weighted stocks, last traded down LE 41.31, or 16.6 percent, at LE 208.12.
Shares in Commercial International Bank (CIB) were among many hit by investors realizing profits made in recent sessions, the traders added.
Shares in CIB fell 8.3 percent in Wednesday s session to LE 70, well off an all-time high of LE 79 hit on Tuesday amid reports that a group of international investors would buy an 18.7 percent stake in the bank.
On Wednesday, the bank announced the sale of the stake, which was previously owned by the National Bank of Egypt, for about $230 million, the equivalent of LE 53.50 per share. Reuters