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[2007-10-18] Egypt stocks drop for first time in 7 sessions
Egypt's benchmark stock index fell on Wednesday for the first time in seven sessions as investors took profits on shares of Orascom Construction Industries , traders said.
The Case 30 index shed 0.4 percent to 9,020.92 points. It had gained about 3.4 percent over the past six sessions, hitting a life-high on Tuesday.
"It takes time to get used to the 9,000-point level," said Yasser Hassanein of Dynamic Securities. "There might be profit-taking and we could see a sell-off with the market dropping maybe a couple of hundred points or so within the next few days."
Shares of Orascom Construction, Egypt's largest building firm by market value, have risen about 25 percent since the beginning of September. They dropped 3.1 percent to 463.30 Egyptian pounds ($83.63).
Shares of EFG-Hermes, Egypt's largest investment bank by market value, dropped 2.5 percent to 48.70 pounds.
"The 50 pound level is a resistance and sellers are emerging there based on technicals," Aly Allouba of Delta Securities said.
Shares of Orascom Telecom, the fourth-largest Arab telecom firm by market value, bucked the trend, jumping 2.5 percent to 77.79 pounds. The stock has closed higher the past two trading sessions.
"On the back of the company's results the share is undervalued," Hassanein said. "It should at least be in the 80s."
The company said on Tuesday it had bought back 1.39 million global depositary receipts, equivalent to 6.93 million local shares.
Orascom Telecom, which posted a tripling in first-half net income in September, is trading at a price to estimated 2007 earnings ratio of 16.54, according to Reuters data.
Shares of Sidi Kerir Petrochemicals led gains, soaring 7.4 percent to 19.83 pounds. The stock was rallying as investors anticipated the company would profit after oil prices hit record highs of above $88 a barrel.
Egypt's Hermes index slipped 0.3 percent to 79,509.43 points. The broader CIBC index edged down 0.01 percent to 399.96 points.
Source: © Reuters 2007.
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