Anticipation prevails on the money market; everyone is waiting for a decision on interest rates
Anticipation prevails in the money market, as all wait for the Monetary Policy Committee (MPC) of the Central Bank of Egypt (CBE) to meet on Thursday and set the country’s interest rates.
Many are also awaiting the appointment of a new CBE governor following Tarek Amer’s resignation on Wednesday.
Commercial International Bank (CIB) stock, which has the largest relative weight in the EGX30, rose 3.23% and closed at EGP 38.7 per share.
At the end of Wednesday’s session, the Egyptian Stock Exchange (EGX) indices saw a collective rise, with the main EGX30 index rising 2.18% to trade at 10,058 points.
Mostafa Al-Kurdi – head of the Arab African Securities group – said the market is waiting for the CBE’s decision on interest rates, adding that the performance of EGX70 is better than that of EGX30 currently due to high liquidity rates.
In addition, he specifies that the EGX30 has started a corrective movement at the level of 9,759 points and should rebound to 10,200 points, while the EGX70 is targeting 2,200 points.
Meanwhile, investment banks have differing views on their expectations for the MPC’s decision, with some believing the CBE will keep interest rates at their current levels ahead of a calm wave of price hikes and relative stability. exchange rates, while analysts expect the possibility of raising interest rates by 200 basis points under pressure from the US Federal Reserve, which is expected to raise interest at its next meeting in September.
For her part, Mona Mostafa – Head of Trading at Arabia Online Securities Brokerage – said Wednesday’s session reflected weakness in momentum indicators for EGX30 since the previous Wednesday’s session against the trend of liquidity towards companies in the Middle East. EGX70 index over the past few sessions, adding that there is a growing desire to speculate in small and medium-sized company stocks.
Additionally, the recent collective decline in the indices coincided with one session remaining before the CBE’s interest rate decision, prompting the market to take some profits.
She advised long-term investors to seize current opportunities in major stocks – given that they are in a period of consolidation – stressing the need to stick to currently open positions in stocks, buy dips and sell on each upward bounce.
EGX recorded EGP 1.8 billion in 61,966 transactions across 192 companies as overseas investors tend to sell, recording a net worth of EGP 180.5 million under pressure from institutions that made a sale net of EGP 181.946 million, compared to net EGP 1.362 million. purchases from individuals.
Meanwhile, transactions by Egyptian investors were mainly purchases, recording a net worth of EGP 155.952 million with support from institutions which recorded net purchases of EGP 157.011 million, compared to net sales of EGP 1.058 million from individuals.
Finally, transactions by Arab investors recorded a net purchase of EGP 24.631 million, of which EGP 24.178 million by individuals and EGP 453,567 million by institutions.