Egypt stocks slip despite IMF loan agreement

Egypt stocks slipped slightly on Monday, although news of an initial agreement between Egypt and the International Monetary Fund over a proposed $4.8 billion loan agreement cushioned what might have been a much more severe drop. "News spread in the market that Egypt had reached an initial loan agreement with the IMF, keeping investors positive," Ashraf Abdelaziz, head of institutional sales at Cairo-based Arabeya Securities, told Ahram Online. The main EGX30 index fell by 0.07 per cent for the day to alight at 5,410 points. Total daily turnover, meanwhile, stood at some LE389 million. By 1:30pm, the stock exchange rebounded after shedding 82 points in the first three hours of the four-hour trading session. By midday, Egypt and the IMF announced that a staff-level agreement had been reached on the $4.8 billion loan facility. The IMF board is expected to approve the loan on 19 December, and the first tranche of the loan will be disbursed immediately afterwards. The loan is seen by many as a much needed lifeline for the Egyptian economy, which remains dogged by a surging current account and budget deficits. The largest listed company, Orascom Construction Industries (OCI), saw LE20 million in turnover, gaining 0.58 per cent to close the day's trading at LE259.82 per share. Palm Hills Development (PHD) was the most active share in Monday's session, recording some LE41 million in daily turnover. It fell by 2.07 per cent to close the day out at LE2.47 per share. The broader-based EGX70index, meanwhile, fell by 1.04 per cent. Of 157 stocks traded on Tuesday, 48 gained while 109 declined in value. Foreign investors represented the day's only net buyers, while local and Arab investors were net sellers.