5 - 11 April 2001
Issue No.528
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Al-Ahram Weekly On-line 5 - 11 April 2001 Issue No.528 |
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Waiting for a catalyst
The market continues its decline as local and international investors are left starving for good news and world markets suffer a lingering depression. Sherine Abdel-Razek reports
The lack of a local stimulant and the global capital market's plunge have contributed to the market's continuing slide for yet another week.
The Capital Market Authority's (CMA) all-share index has lost 6.22 points to close at 596.6. EFG-Hermes' blue-chip index, which includes the most actively traded companies, has reached its lowest level in seven years, having plunged to 5,916, its lowest level since it hit 5,889 in May 1994.
Transactions volume came to LE195 million for the week ending 29 March, compared to LE204.9 for the previous week.
Traders are finding it difficult to shake off their pessimism about the coming period. "With the summer months just ahead of us -- a traditionally slower time for the local bourse -- there is little doubt that the market will continue to trade sideways until a fundamental catalyst is introduced," noted a report issued by EFG-Hermes.
Telecom companies were the most badly stung by the downturn. The Egyptian Company for Mobile Services (MobiNil) dropped by LE5.02 to close at LE55.34 pounds. Its parent company, Orascom Telecom (OT), was no luckier. OT shed LE2.65, closing at 25.60 pounds, its lowest level since its IPO in July.
The medical and financial conglomerate, Lakah Group, was able to buck the sliding trend, ending eight per cent higher at LE1.34. The group had posted a huge loss for the fiscal year ending December 2000, realising a net loss of LE299 million, compared to a net profit of LE172 million for the previous year. Revenues dropped 62 per cent- from LE1.23 billion in 1999 to LE468 million in 2000.
Orascom's construction arm, Orascom Construction Industries, had some good news to offer. A joint venture that includes its fully-owned subsidiary, Contrack International, has won a $43 million contract to build a wastewater treatment system in Luxor. The contract, awarded by the US Agency for International Development (USAID), is slated to be executed by 2003.
Investors in Helwan Portland are set to receive a 12 per cent dividend on their investments as decided by the company's general assembly meeting. The meeting approved a cash dividend of LE5 per share for fiscal year 2000. The shares ended at LE42.35, registering a marginal gain of 40 piastres.
Suez Cement investors are awaiting the company's results due to be released next week. Egypt's biggest local cement producer has not yet clarified the accounting standards it is using, leaving open the question of whether the results will show investment income from Tourah Cement, which it acquired in 1999. EFG-Hermes has predicted the company's earning to range between LE270 million and LE396 million.
Foreigners are still pulling out of the market, with their buying orders coming to LE25.5 million, compared to LE38.5 million worth of selling transactions. The number of companies that ended the week lower have outnumbered gainers. Out of 136 companies traded, 65 lost ground, 37 ended higher and the rest came flat.
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