By: Heba El-Kordy
Cairo – Mubasher: Foreign investors were net buyers on the Egyptian Exchange (EGX) with EGP 8.34 billion since the beginning of 2017, according to the EGX’s monthly bulletin.
Arab investors were net buyers with EGP 635.14 million since January 2017, excluding transactions, the EGX added.
Foreign buying was the main supporter of the EGX since the flotation of the Egyptian pound (EGP), analysts told Mubasher.
Analysts forecasted foreign buying to rise over the coming period after the issuance of the new investment law and the expectations of lowering interest rate.
Technical analyst at the African Economic Council Mona Mostafa said that the EGP flotation has boosted purchasing powers of foreign investors in the EGX, which increased the liquidity levels.
The EGX has attracted foreign investment as their profits doubled on the back of the EGP depreciation and the stocks’ profitability, Mostafa highlighted.
Foreign buying are likely to maintain supporting the EGX over the coming period, especially after the new investment law which aims at luring direct and indirect investments to Egypt, she expected.
At the level of Arab investments, she noted that Arab investors are only trading in the EGX because of profit-takings and correction phases that the Arab markets are currently witnessing.
The analyst indicated that Arab buying on the EGX would remain the same until the Arab markets and oil prices settle.
Egyptian investors dominated 77.69% month-on-month of total market transactions in October, while foreign and Arab investors made up 13.88% and 8.43%, respectively.
Foreign buying amounted to EGP 177.82 million in October, while Arab buying stood at EGP 228.11 million, excluding transactions.
Moreover, Hesham Hassan, head of technical analysis at Acumen Securities Brokerage said that foreign investors are representing the true supporter of the EGX since the liberalisation of the exchange rate.
Arab buying were minor, compared to foreign buying which bolstered the EGX over the previous period, Hassan noted.
The technical analyst anticipated foreign buying to carry on its positive performance in the EGX, in line with reducing interest rate expectations over the next period.
Translated by: Mai Ezz El-Din
