Egypt bourse to remain volatile on FX fears

  • Share via facebook
  • Tweet this
  • Bookmark and Share

Cairo's benchmark is expected to remain volatile on Thursday as institutional investors stay away and traders sell stocks on fear Egypt's currency could weaken further.

After two years of political upheaval, foreign currency reserves in Egypt have fallen to critically low levels, limiting Egypt's ability to buy wheat, of which it is the world's biggest importer, and fuel.

The main share benchmark fell 2.2 percent on Wednesday to its lowest level since December 6.

"Egypt is trading at a discount due to the political and economic risks it has been facing - obviously the volatility will be high," says Marwan Shurrab, vice-president and chief trader at Gulfmena Investments.

"The market is unpredictable due to the fact that most trading is happening on the retail level and there's an obvious lack of institutional investors in the market."

Global concerns will also weigh on the Gulf bourses.

International investors are nervously watching developments in the Korean Peninsula, while Asian stocks are down after weak data stoked concerns the key American jobs report due later in the week will signal slowing US growth.

Kuwait's banks will be in focus after parliament approved a law on Wednesday to buy some citizens' personal loans and write off the interest after lawmakers argued that banks had overcharged Kuwaitis for credit.

Under the law, banks would have to pay back any overcharged interest to citizens. This would apply to interest charged at more than 4 percent over the discount rate and it was not immediately clear how much this would cost.

Join the Discussion

Disclaimer:The view expressed here by our readers are not necessarily shared by Arabian Business, its employees, sponsors or its advertisers.

Please post responsibly. Commenter Rules

  • No comments yet, be the first!

Enter the words above: Enter the numbers you hear:

All comments are subject to approval before appearing

Further reading

Features & Analysis
Taking stock

Taking stock

Gulf stock markets have seen a dearth of IPOs since the global...

Steering clear of the stock markets

Steering clear of the stock markets

Listing was all the rage three years ago, but IPOs have since...

Egyptians vent post-revolt fury in litigation

Egyptians vent post-revolt fury in litigation

Bankers, stockbrokers say indiscriminate corruption probes may...

Most Discussed
  • 54
    Three UAE women attacked with hammer at London hotel

    I really feel that Arabian Business.Com should now close this comments page. This should be all about sympathy for the families not what it is/has turned... more

    Wednesday, 16 April 2014 1:06 PM - Adrienne
  • 51
    Why Dubai isn't a plastic city

    What is definitely not a plastic city. The Arabs have a culture dating back to several centuries. 50 years back Dubai was just a fishing village. Today... more

    Tuesday, 8 April 2014 3:49 PM - P. MADHUSUDAN
  • 48
    DMCC boss Ahmed Bin Sulayem entertains Robert Mugabe in Dubai

    @fga ''However today, simply because he decided to dispossess a few white farmers of their land and redistribute to the poorer indigenous blacks'' more

    Sunday, 13 April 2014 3:02 PM - Matt Williams