Egypt shares re­sume rally bol­stered by pos­i­tive earn­ings sea­son amid heavy liq­uid­ity


The Daily News Egypt - - Business -

Egypt shares are pre­dicted to move up­wards in the short term buoyed by above-ex­pec­ta­tion earn­ings sea­son and very at­trac­tive val­u­a­tions of blue-chips stocks, an­a­lysts said on Satur­day.

They added that the stock mar­ket is ex­pected to con­tinue its pos­i­tive trend this week, and may aim for 14,500 points.

The Egyp­tian Ex­change’s (EGX) in­dices are fore­casted to move up­wards in the short term, Head of the Cap­i­tal Mar­ket Com­mit­tee at the African Eco­nomic Coun­cil, Ay­man Fouda, stated. He noted that the EGX30 in­dex may reach re­sis­tance at 13,652, then 13,800 points, while sup­port will be seen at 13,550, fol­lowed by 13,260 points.

Fouda fur­ther in­di­cated that the small and medium-cap in­dex EGX70’s short-term re­sis­tance level may reach 705 points,then 712,while its sup­port lev­els will be seen at 688, then 680 points.

The main EGX30 in­dex had traded be­tween 13,600 and 13,700 points dur­ing last week, amid a growth in trad­ing vol­ume, Osama Naguib, head of Tech­ni­cal Anal­y­sis at Arab Fi­nance Se­cu­ri­ties, noted.

The EGX30 cur­rently tar­gets 13,850 points, and may ex­tend to­wards 13,950 points if vol­umes con­tinue ris­ing from their av­er­ages, Naguib con­cluded.

Sail­ing Through a Mar­ket Correction

The EGX ended the first week of November on an up note sup­ported by pos­i­tive fi­nan­cial results an­nounced by sev­eral ma­jor listed com­pa­nies.

EGX30 was able to break the 13,700 level in the last ses­sion of the week, as it added 4%, and set­tled at the level of 13,732.68 points.

EGX70 rose by 2.1% and closed at 702.82 points, while the broader EGX100 gained 2.2% and ended the week at 1,760.33 points. Equal­weighted in­dex EGX50 went up 4.7% to 2,200.56 points.

Mar­ket cap­i­tal­iza­tion in­creased by EGP 25.9bn to reach a to­tal of EGP 776.8bn.

Last week, Emaar Misr for De­vel­op­ment re­ported a 20.8% yearover-year (y-o-y) rise in con­sol­i­dated prof­its for the first nine months of 2018.

Net profit to­talled EGP 1.75bn in the pe­riod be­tween Jan­uary and Septem­ber, up from EGP 1.45bn, in­clud­ing mi­nor­ity share­hold­ers’ rights, the prop­erty de­vel­oper said in a fil­ing to the EGX.

Rev­enues rose slightly to EGP 2.8bn in the nine-month pe­riod ended Septem­ber, ver­sus EGP 2.59m in the same pe­riod of 2017.

Stand­alone prof­its grew to EGP 1.759bn at the end of Septem­ber, com­pared to EGP 1.456bn in the first nine months of last year.

Emaar Misr pre­vi­ously said it achieved prof­its of EGP 1.1bn in the first half (H1) of 2018, up 12.6% from EGP 976.9m in the prior-year pe­riod.

The Com­mer­cial In­ter­na­tional Bank - Egypt (CIB) was among the mar­ket’s best per­former last week, as it posted a 24% y-o-y in­crease in prof­its for the first nine months.

Prof­its amounted to EGP 7.01bn dur­ing the nine-month pe­riod ended 30 Septem­ber, ris­ing from EGP 5.67bn in the same pe­riod of the pre­vi­ous year, the bank said in a fil­ing to the EGX.

Net in­come rose to EGP 13.3bn dur­ing the pe­riod be­tween Jan­uary and Septem­ber, from EGP 9.3bn in the year-ago pe­riod.

Stand­alone prof­its went up to EGP 7bn by the end of Septem­ber, ver­sus EGP 5.68bn in the same pe­riod of 2017.

For the third quar­ter (Q3) of 2018, the CIB re­ported a growth in prof­its to EGP 2.5bn, com­pared to EGP 2.08bn in Q3 of 2017.

Trade Talks to Spur More Volatil­ity

In other earn­ings news, Global Tele­com Hold­ing re­ported turn­ing to losses on a yearly ba­sis for the first nine months of 2018.

Losses amounted to $345.1m for the nine-month pe­riod ended 30 Septem­ber, against prof­its of $56.8m in the same pe­riod of the prior year, the com­pany said in a fil­ing to the EGX.

Rev­enues nar­rowed to $2.12bn by the end of Septem­ber, from $2.29bn in the same pe­riod the year be­fore.

Stand­alone results showed that losses had jumped to $338.7m dur­ing the nine-month pe­riod be­tween Jan­uary and Septem­ber, ver­sus $84.5m in the prior-year pe­riod, Global Tele­com added.

In Q3 of 2018, the tele­com firm recorded sharp losses of $357.6m, against prof­its of $20.5m in Q3 of 2017.

Glob­alT­ele­com pre­vi­ously re­ported turn­ing to prof­itabil­ity in H1 of 2018, with $413.1m, against a net loss of $59.4m in H1 of 2017.

Com­pany-Spe­cific Fac­tors

The con­sol­i­dated fi­nan­cial state­ments of Abu Dhabi Islamic Bank Egypt (ADIB) showed a 26% y-o-y in­crease in prof­its dur­ing the first nine months of 2018.

The ADIB logged EGP 632.19m ($35.26m) from Jan­uary to Septem­ber,up from EGP 500.6m ($27.92m) in the same nine months last year, ac­cord­ing to a state­ment to the EGX.

The bank at­trib­uted the growth in prof­its to a rise in in­come from re­turns,which amounted to EGP 1.8bn, from EGP 1.48bn in the Jan­uary-toSeptem­ber pe­riod of 2017.

The ADIB-Egypt at­trib­uted the higher re­turns in­come to mar­gin growth in its fi­nanc­ing port­fo­lio by 37% to EGP 668m, in ad­di­tion to an in­crease in yield from trea­sury and de­posits in­vest­ments by 44% y-o-y to EGP 520m.

As for the stand­alone busi­ness,the ADIB-Egypt posted EGP 608.4m in the nine-month pe­riod, up from EGP 348.8m in the cor­re­spond­ing pe­riod a year ear­lier.

In other mar­ket news,Qalaa Hold­ings said that its sub­sidiary,Asec Ce­ment, has signed a me­moran­dum of un­der­stand­ing (MoU) with Groupe in­dus­triel des ci­ments d’Al­gérie (GICA) to exit from the Al­ge­ri­abased Za­hana Ce­ment Fac­tory.

Upon the MoU, the GICA will pur­chaseAsec’s stake in Za­hana,the com­pany high­lighted in a fil­ing to the EGX.

The trans­ac­tion is ex­pected to take place prior to mid-2019 af­ter set­ting the fair value of the shares,the Egyp­tian in­vest­ment firm in­di­cated.

Qalaa Hold­ings holds a 52% stake in Asec Ce­ment which owns 35% of Za­hana Ce­ment’s shares.

In Septem­ber, Qalaa Hold­ings an­nounced that Asec Ce­ment was look­ing to exit from the Al­ge­rian fa­cil­ity Za­hana Ce­ment.


The mar­ket is ex­pected to con­tinue its pos­i­tive trend this week

Newspapers in English

Newspapers from Egypt

© PressReader. All rights reserved.