With the Egyptian Exchange’s (EGX) continued fluctuating performance, purchases of only selected stocks have become the best investment policy, especially for companies that announce strong financial results.
Mohamed Othman, Head of Technical Analysis at Pharos Holding, said, “A weekly close below the predefined support level would confirm the bearish breakout, and would pave the way for further decline where the next support level will stand at 11,350 followed by 11,250 points.”
“On the other hand, the first interim resistance level to watch lies at 11,600 followed by the more important level 11,675 points,” he added.
Othman said that Pharos Holding is continuing to advise investors to adopt a more conservative attitude by reducing the margin, whilst adhering to the stop loss levels for each stock separately. They also recommended that investors hold onto cash until a consistent buying power reappears.
Last week, the benchmark index EGX30 closed at 11,380.55 points, recording a decline of 1.44%. The EGX70 EWI posted 4.17% loss, concluding the period at 2,350.39 points, while the S&P index declined by 2.12% to conclude the period at 1,928 points.
EGX30 Capped declined by 1.47% and concluded at 14,048.7 points, while the EGX100 EWI declined by 3.26% and concluded the period at 3,374.34 points.
Total market capitalisation reached EGP 697.1bn at the end of period, representing a decrease of 1.52% over the last week.
The total value traded recorded EGP 20.2bn, while the total volume traded reached 3,534m securities executed over 253,000 transactions last week. For the week before last, the total value traded recorded EGP 24.1bn, while the total volume traded reached 4,583m securities executed over 286,000 transactions.
Stocks trading accounted for 37.57% of the total value traded of the main market, while the remaining 62.43% were captured by bonds over the week.
Egyptians represented 87.7% of the value traded in listed stocks after excluding deals during the period. Foreigners accounted for 7.2%, while Arabs captured 5.1%.
Foreigners were net sellers, with a net of EGP 160.1m, and Arabs were net buyers, with a net of EGP 34.6m, after excluding deals in listed stocks.
Since the beginning of the year Egyptians represented 84.5% of the value traded in listed stocks after excluding deals, Foreigners accounted for 8.5%, while Arabs captured 7.0%. Foreigners were net buyers by EGP 364.0m, and Arabs were net buyers by EGP 128.5m, after excluding deals in listed stocks since the start of the year.