[2007-08-03]  Egypt's indexes fall with world markets
CAIRO (Reuters) - Egypt's main stock indexes fell on Wednesday, led by the housing sector, as worldwide negative investor sentiment continued to batter the Egyptian market, brokers said.

"The market continued to drop further today and it's a downward spiral... we're following what the world markets are doing. They are selling off, and so people are selling off here too," said Yasser Hassanein of Dynamic Securities.

Overall the well-watched Case 30 index dipped 1.6 percent to close at 8,110.13 points, while the benchmark Hermes index closed 1.3 percent down at 71,805.64 points. The broader CIBC index closed 0.6 percent down at 346.92 points.

Brokers said the market would likely continue its decline under the weight of struggling U.S. and European markets until they stabilized.

"I don't think the Egyptian market is going to go up alone without stabilization of the world markets, especially U.S. markets, said Mohammed Ezz of Delta Securities.

"This is because we have a very strong correlation between the Egyptian and U.S. markets," he added.

Global markets were pounded on Wednesday with heavy losses in London and Tokyo as credit market concerns battered prices.

The worst performers on the Egyptian market were real estate stocks, led by Egyptian Resorts which fell 2.9 percent to 10.85 pounds per share as the most actively traded stock.

Sixth of October Development and Investment Company also fell, dropping 2.1 percent to 160.7 pounds a share, while Heliopolis Housing took a fall of almost six percent to close at 542.5 pounds a share.

Bucking the trend was Arabia Cotton Ginning, whose shares climbed 2.1 percent to 9.13 pounds per share with news of the company's share offer to acquire Amwal Al-Arabia Cotton Company at 129.43 Egyptian pounds per share.

Arabia Cotton Ginning would issue a maximum 66.6 million new shares under a capital increase at 11.03 pounds each, and those would be swapped for Amwal shares.

"So that's why people are seeing that 9 pounds is a good buy," Hassanein said. "That's the reason it went up today."



© Reuters 2007
Source: © Reuters 2007. All Rights Reserved.