The Egyptian Exchange (EGX) is gearing up for a shortened trading week following the holidays, but it is facing challenges due to ongoing geopolitical upheavals that are expected to impact its performance in the upcoming sessions.
Last week, the benchmark index EGX30 saw a slight decline of 0.01%, closing at 28,504 points, while the EGX70 EWI experienced a rise of 0.94% to reach 6,541 points. The EGX30 Capped index and the comprehensive EGX100 EWI also saw increases, along with the S&P index.
Hossam Eid, the Chairperson of Cairo National for Investment and Securities, believes that the EGX30 may face resistance levels at 29,000 and potentially 30,000 points, depending on its stability above the support mark at 28,000 points. He also mentioned that recent international and regional geopolitical developments could influence the stock market’s trajectory, potentially leading to a dip in the index followed by a rebound.
Investors are advised to focus on stable stocks with consistent profit growth and to avoid volatile equities to minimize risk. The trading volume last week was valued at EGP 5.3bn, with Egyptians dominating the trading activity.
Mohamed Fareej, the Head of Technical Analysis at El Suk Securities Trading, anticipates a test of a crucial resistance point at 28,900 points, with a potential ascent to 29,500 points if buying momentum outweighs selling pressures.
However, a downturn is expected in Monday’s session due to recent events in the Middle East, leading to selling activities and withdrawals. Investors are urged to be cautious, avoid margin trading, and consider reducing positions at stop-loss intervals.
Egyptian investors have been the most active in listed stocks since the beginning of the year, with foreigners and Arabs also participating. Foreign traders have seen net sales, while Arab participants have recorded net sales as well. Foreign entities have made net acquisitions, while Arab traders have shown net disposals in listed stocks.
As the EGX navigates through geopolitical uncertainties, investors are advised to stay vigilant and adapt their strategies accordingly to navigate the market’s fluctuations.
