Egypt stocks tumble on Cairo unrest
CAIRO (AP) — Egypt's benchmark stock index tumbled more than 2 percent on Sunday as clashes between protesters and security forces entered their second day and rattled investor confidence in the country's already stumbling economy.
The Egyptian Exchange's EGX30 index was down 2.45 percent, or at 4,023 points, by 12:15 p.m. on the first day of the work week in the country. The slide built on a week of declines that have helped push the index's year-to-date losses to almost 44 percent. The index had tumbled almost 3 percent earlier in the day, but recouped some of the losses.
Brokers attributed the drop to the clashes between rock-throwing protesters and security forces in Cairo's iconic Tahrir Square, the epicenter of the uprising that ousted former President Hosni Mubarak in February.
The fighting had entered its second day, with the protesters demanding the country's military rulers quickly announce a date when they plan to hand over power to a civilian government. The unrest comes days before the Nov. 28 parliamentary elections — the first national vote in roughly 30 years that doesn't include candidates from the former ruling National Democratic Party.
"These are bad times," said Khaled Naga, a senior broker with Mega Investments, adding that even after a thousands-strong demonstration on Friday went relatively peacefully, there were expectations that the market would decline.
"All things considered, this is a reasonable decline," said Naga. "We were expecting worse — maybe 5 percent."
Shares of Commercial International Bank were down almost 2.2 percent to 23.22 Egyptian pounds while Orascom Construction Industries' shares were off 3.24 percent to 220.2 Egyptian pounds.
The Jan. 25 revolution that toppled Mubarak and ended nearly three decades of authoritarian rule has battered the country's economy.
Foreign investment and tourism, which are two of the country's economic pillars, are reeling from the unrest, while frequent labor strikes and other mass protests have disrupted daily life and forced the government to adopt populist policies that have widened the deficit and added to expenses.
Already, Egypt has run through almost 40 percent of its net international reserves since December.
Brokers said continued unrest in the capital would likely only add to the drop and expected that the market's support point — where it could bounce back — could be around 3,800 points. But hitting that level would involve a number of days of heavy losses and so far the Egyptian market has shown a surprising ability to bounce back despite the continuing unrest and tension in the nation.