[2008-06-03]  Arab investors send Egyptian bourse down
Arab investors sold blue-chip shares, sending main Egyptian stock indexes down nearly 1 percent on Monday, but El Sewedy Cables SWDY.CA bucked the trend on news it planned to build a new plant in Qatar.

The benchmark CASE 30 index .CASE30 dropped about 1 percent to 10,924.71 points, while the Hermes index .HRMS lost 0.8 percent to 94,607.52 points. The broader CIBC index .CIBC fell about 2 percent to 570.51 points.

Traders said the Arab investors appeared to be booking profit after six sessions of gains between May 22 and May 29 that saw the benchmark index moving beyond 11,000 points.

"It is possible that people saw the 11,000 point level as a resistance point and sold after hitting it," said Mohamed Fouad, managing director of Global Securities.

The main loser was market heavyweight Orascom Construction Industries (OCI> OCIC.CA (OCICq.L: Quote, Profile, Research), Egypt's largest listed builder, which shed 1.7 percent to last trade at 384 Egyptian pounds ($71.78).

Ezz Steel ESRS.CA (AEZDq.L: Quote, Profile, Research), Egypt's largest steel producer by sales, fell 2.5 percent to 82.23 pounds, shrugging off a bullish recommendation from HC Securities which rated the stock as "accumulate" and maintained its price target of 98.5 pounds.

But shares in El Sewedy, one of the biggest cable makers in the Middle East, rose 3 percent to 144.99 pounds after the company said it would build a $150 million power cable plant in Qatar to tap surging Gulf Arab infrastructure spending.

"This is definitely the reason for the rise," said Hashem Ghoneim of El Nour Securities. "Sewedy is a very good company. It was overpriced in recent months, then went through a correction and now it is rising on fundamental news."

Source: © Thomson Reuters 2008