Egyptian shares slumped the most in almost three months as investors speculated gains in the world’s best-performing market this year were overdone.
The benchmark EGX30 Index dropped 3.3 percent, the most since Dec. 18, to 5,052.18 at the 2:30 p.m. close in Cairo. That pared the measure’s surge this year to 39 percent. Orascom Construction Industries (OCIC), the country’s biggest publicly traded builder, fell to the lowest level in almost three weeks. Orascom Telecom Holding SAE (ORTE) retreated 4.9 percent.
“The market was overbought, and some of the noise about dissolving the government and declines in corporate earnings are giving people an excuse to sell,” said Cairo-based Ramy El Agamy, manager of institutional sales at NBK Capital Securities Egypt. “The gains we’ve seen so far this year were more based on the removal of risk on the political front rather than economic fundamentals.”
Egypt’s benchmark stocks gauge is down 6.4 percent this week after posting 10 straight weekly gains since the start of the year. The country’s parliament agreed on March 11 to start the process toward withdrawing confidence in the government, although it is unclear whether the legislature has the constitutional power to do so.
Orascom Construction decreased 1.8 percent to 262.89 pounds.
Orascom Telecom lost the most in almost four months to 4.07 pounds. North Africa’s biggest mobile phone company reported a $91 million loss in the fourth quarter.
Palm Hills Developments (PHDC), a Cairo-based property developer, said this week it had a 2011 loss of 331 million pounds ($55 million) after a 560 million-pound profit a year earlier.
To contact the reporter on this story: Ahmed A Namatalla in Cairo at firstname.lastname@example.org
To contact the editor responsible for this story: Claudia Maedler at email@example.com