Egypt Stocks Slump 9.5 pct on Morsi Decree

Egypt’s stocks have plunged on the first trading day of the week following President Morsi's controversial Constitutional Declaration on Thursday. The main index EGX30 fell 9.5 per cent to below 5000. The broader index EGX70 tumbled 8 per cent. Trading was suspended for 30 minutes after stocks tumbled five per cent at the beginning of the trading session. 169 shares dropped value while 15 remained unchanged. President Morsi issued a Constitutional Declaration on Thursday stating his decisions cannot be overturned by any judicial authority. The decision angered many Egyptian judges, who said it impinged on their authority.

The declaration also replaced the prosecutor-general, who Morsi had attempted to remove several weeks ago but could not due to a legal barrier. “The current political instability following President Morsi’s controversial declaration is behind the stock market plunge. An increase is still possible at the end of Monday’s session as investors might still be willing to take the risk despite the current turmoil,” said Ashraf Abdel-Aziz, head of institutional sales at Cairo-based brokerage Arabeya Online. “However, it is almost certain that the stock market will witness further losses on Tuesday due to scheduled protests [against the Constitutional Declaration],” added Abdel-Aziz. Around 180 listed stocks are suffering losses on Sunday, headed by heavyweight shares Orascom Construction Industries and Commercial International Bank, which were down by 9.5 and 10 per cent respectively. Investment bank EFG-Hermes and Orascom Telecom slipped by 10 and 9 per cent respectively.