Cairo - Mubasher: The Egyptian Exchange (EGX) saw a negative performance in the second week of July, with mounting pressures rising from investors’ concerns regarding the Global Telecom deal.
Global Telecom Holding (GTH) recently announced that it has received an offer from VEON Ltd to purchase its assets in Jazz and associated operations for $2.55 billion.
The main index EGX30 went down 1.52%, and ended the week at the level of 15,879.81 points.
Market analyst Michael Mamdouh of Arabeya Online told Mubasher that the Egyptian Exchange has continued the correction wave below the level of 16,000 points, amidst fluctuations for the benchmark index.
The correction is led by Global Telecom, leading EGX30 to break the support level of 15,781, especially with a correction movement in the housing sector, Mamdouh explained, noting that the current support levels will be between 15,781 and 15,500 points, while resistance lie at 16,100 points.
Meanwhile, the small and medium enterprise index EGX70 lost 3.1% and ended the week at 775.10 points, while the broader index EGX100 dropped 2.15% to close at the level of 1,990.09 points.
EGX70 is also seeing a correction movement below 800 points, and has been seeing negative performances since March, with support levels now between 767 and 750, and resistance at 800 and then 820 points.
The equal-weighted index EGX50 slipped 0.38 and closed on Thursday at 2,708 points.
The market capital lost EGP 8.5 billion, and reached EGP 889.9 billion by the end of the week.
Telecom sector experts believe the VEON offer for GTH is 25% higher than the market price, with fair value evaluation for the stock now at EGP 6 per share, as well as an expected dividends distribution at EGP 3.5 per share.