Egyptian shares fell to the lowest level since January as crowds descended on Tahrir Square to protest the verdict in Hosni Mubarak’s trial and demand the disqualification of Ahmed Shafik from the presidential race.
The benchmark EGX30 Index (EGX30) dropped 2.3 percent to 4,502.91, the lowest level since Jan. 26, at the 2:30 p.m. close in Cairo. Orascom Construction Industries (OCIC) retreated to the lowest level in almost two months. EFG-Hermes Holding SAE (HRHO), the biggest publicly traded Arab investment bank, declined 1.8 percent.
Egyptian activists and the Muslim Brotherhood prepared for mass rallies today to drive Shafik, Mubarak’s last prime minister, out of the presidential race. The rally marks the third day of protests after Mubarak was handed a life sentence for complicity in the killing of protesters last year.
“Sentiment remains related to political headlines,” said Wafik Dawood, director of institutional sales at Cairo-based Mega Investments Securities. “The call for protests is raising fears of more instability. In the absence of positive corporate news, we expect negative sentiment to prevail at least until the presidential runoff is held.”
Voters are scheduled to go to the polls beginning June 16 to choose between Shafik and Mohamed Mursi, the Muslim Brotherhood’s candidate, as the first president after Mubarak. Protesters are demanding the formation of a civilian presidential council, the retrial of Mubarak and other former regime officials before a revolutionary court, and the implementation of a law that would bar some officials, including Shafik, from running for office.
EFG-Hermes, whose shareholders shunned a buyout letter of intent from Planet IB Ltd. in favor of creating a joint investment bank with Qatar’s QInvest, fell the most since May 27 to 10.68 Egyptian pounds. Karim Awad, EFG-Hermes’ head of investment banking, said in an interview with Bloomberg TV today regulatory approval for the deal is expected “in the next few weeks.”
The company’s first-quarter profit fell to 35 million pounds from 37 million pounds a year earlier, it said today
Orascom Construction, Egypt’s biggest publicly traded builder, lost 2.1 percent to 248.22 pounds.
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