Egypt Stocks Slump to Two-Month Low on Verdict, Global Economy
Egypt’s stocks tumbled to the lowest level in almost two months after the verdict in the trial of former President Hosni Mubarak sparked protests and on concern global economic growth is slowing.
Orascom Construction Industries (OCIC) declined to the lowest intraday level since April 22. Ezz Steel, the country’s biggest publicly traded manufacturer of the metal, lost 1.5 percent. The benchmark EGX30 Index (EGX30) dropped 1.9 percent to 4,599.13, the lowest intraday level since April 11, at 11:09 a.m. in Cairo.
A Cairo court handed life sentences to Mubarak and his interior minister Habib El-Adli for complicity in the deaths of demonstrators during last year’s apprising. It also acquitted six assistants of El-Adli of the charges related to the killings and Mubarak’s two sons of corruption charges. All decisions are subject to appeal. Thousands of demonstrators filled Cairo’s Tahrir Square within hours of the verdict to voice their discontent.
“Today’s market is definitely politically driven and the global scene is not helping make things better,” said Omar Darwish, equity sales trader at Cairo-based Commercial International Brokerage Co. “People are back in Tahrir demanding the fall of the regime as if nothing had happened over the past year and a half and this may result in the delay of the presidential election.”
European stocks declined for the fourth week in five and U.S. shares tumbled, erasing the Dow Jones Industrial Average (INDU)’s 2012 gain. Oil dropped 3.8 percent in New York on June 1 after the Labor Department said American employers added the fewest workers in a year in May. The jobless rate in the euro region, which has been in the grips of a debt crisis for three years, reached a record high, of 11 percent in April and March.
Orascom Construction, the country’s biggest publicly traded builder, lost 1.3 percent to 254.5 pounds. Ezz Steel (ESRS) slipped to 6.55 Egyptian pounds, poised for the lowest close since April 11.
EFG-Hermes Holding SAE (HRHO) lost 0.6 percent after the biggest publicly traded Arab investment bank rejected a takeover bid from Planet IB Ltd. in favor of a joint-venture with Qatar’s QInvest LLC.
To contact the reporter on this story: Ahmed A Namatalla in Cairo at firstname.lastname@example.org
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