Egypt’s benchmark stocks index fell the most since July after Al Borsa reported the International Monetary Fund delayed a visit and Goldman Sachs Group Inc. cut its recommendation on eight companies in the country.
The EGX 30 Index (EGX30) tumbled 3 percent, the most among 91 gauges tracked globally by Bloomberg, to 5,650.07 at the close in Cairo. Twenty-nine of the 30 shares in the EGX 30 declined, while one was unchanged. Commercial International Bank Egypt SAE (COMI), the country’s biggest listed lender, fell to the lowest level in more than two weeks after Goldman Sachs cut the shares to sell.
An IMF team postponed a visit to Egypt until December, after the fund’s annual meeting in Tokyo, the newspaper reported today, citing Finance Minister Momtaz El Saieed. The delegation was due to arrive last month to discuss terms of a loan agreement for up to $4.8 billion. The EGX 30 is still up 56 percent this year, the best performer among global benchmarks, as political stability increased and prospects for international aid started to materialize.
“The market was due for a hit,” Mohamed Radwan, head of equities at Pharos Holding for Financial Investment in Cairo, said by phone.“Investors had expected the IMF visit delay to be until this month. Today’s Goldman report was also a wake up call to investors that it may be time to lock in profits.”
Company earnings forecasts failed to keep up with share gains, reducing the potential median upside for Egyptian stocks Goldman Sachs covers to 5 percent compared with 14 percent for shares covered in the Middle East and North Africa covered, analysts including Dubai-based Eshan Toorabally and Matija Gergolet, wrote.
CIB retreated 1.9 percent to 33.99 Egyptian pounds. Talaat Moustafa Group (TMGH) Holding, the country’s biggest publicly traded property developer, slumped 4.6 percent, the most since July 9, to 5.2 pounds.
The finance minister couldn’t be reached for comment, when contacted by Bloomberg News on his mobile phone.