CAIRO,(Reuters) – Egypt’s benchmark index .CASE30 trudged higher on Wednesday, a day after posting the sharpest single-day gain in nearly three months, although telecom shares sank on an HSBC downgrade, dealers said.
The CASE 30 index added 0.14 percent to end at 3,867.56 points, adding to Tuesday’s gains of 5.24 percent.
“One day of 5 percent gains in the market was a bit too much to handle. So today it is cooling off,” said Mohamed Radwan of Pharos Securities. “Today was a good day after yesterday.”
But telecom shares dropped, weighing on the market, after HSBC cut price targets in the sector and said regional mobile operator Orascom Telecom was still exposed to a negative outlook in Pakistan. Orascom shares lost 1.2 percent to 22.30 Egyptian pounds ($4.01).
Egyptian operator Mobinil lost 1.06 percent to 136 pounds after HSBC downgraded its target price to 180 pounds from 230 pounds and rated the stock as ‘overweight’. Fixed-line monopoly Telecom Egypt shed 0.28 percent to 14.50 pounds, below HSBC’s revised price target of 21 pounds.
Shares in investment bank EFG-Hermes, which has lost nearly 80 percent of its value since January 2008, ended the day in the green. The firm added 2.17 percent to 14.57 pounds. Investment bank Pioneers Holding also gained, adding 5.77 percent to 6.05 pounds. Pioneers is one of six firms due to join the CASE 30 index on Feb. 1.
But market heavyweight Orascom Construction Industries, the session’s most heavily traded share, dipped a hair to 109.30 pounds. Dealers said profit-taking was hitting OCI and other big caps. OCI shares had jumped over 5 percent on Tuesday.
“What happened yesterday (in the market) was not very realistic. It was very normal to find declines or stability in the market today,” said Wafik Dawood of Naeem Securities.
Overall, the Hermes index added 0.5 percent to 374.61 points and the broader CIBC index gained 0.22 percent to 275.9 points.