[2008-08-04]  Egyptian stocks fall despite foreign interest
Egyptian stock indexes fell more than 1 percent in very thin volume on Sunday despite news that Dubai had bought into Commercial International Bank (CIB) and that foreigners were seeking blue chip bargains.

The Dubai Capital Group said it had bought a 5.24 percent stake in CIB, Egypt's largest publicly traded bank. "This investment (provides) us opportunities in an environment which has been challenged by the changes in the global financial services sector," the company said in a statement.

CIB shares rose 0.2 percent to last trade at 49.50 Egyptian pounds, again in very low volume.

Nadin Mustafa of CIBC brokerage said market conditions and the fact that it was Sunday dampened the effect the news should have had. "It's a very good deal for both companies," she added.

"The fall in the stock market has made the stock more attractive," said Angus Blair, head of research at Egyptian investment bank Beltone Financial. "The potential growth in Egypt is so much greater than in Dubai."

Aly Allouba of Shuaa Capital said one feature of the session was the interest investment funds based in Britain and the United States showed in Egyptian blue chips such as Orascom Construction Industries and investment bank EFG-Hermes.

Stock exchange data showed that foreigners were net buyers on Sunday by a margin of 61 million pounds, 10 percent of total market turnover at 617 million.

"They (the foreign funds) think these price levels are attractive. The Egyptian funds are short-term sellers, but the UK and US funds are long-term buyers," Allouba said.

But OCI shares last traded 1.77 percent down at 383 pounds, while EFG-Hermes ended 0.17 percent higher at 47.49.

Overall, the benchmark CASE 30 index fell 1.09 percent to 9,149.98 points, and the well-watched Hermes index dropped 1.13 percent to 792.46 points. The broader CIBC index lost 1.33 percent to 447.66.
Source: © Reuters 2008.