Egypt’s bourse made its largest one-day decline in two months on concerns over the presidential election outcome, while most Gulf markets slipped yesterday amid uncertainty over a possible Greek exit from the euro.
Cairo’s index fell 3.5%, its biggest one-day drop since March 25, after two of the most divisive candidates emerged as the likely contenders of next month’s run-off vote.
State television said the Brotherhood’s Mohamed Mursi led this week’s vote with 26.4% against 23% for ex-air force chief Ahmed Shafiq, according to preliminary results.
“Some investors are afraid that because we now have the two extreme elements confronting one another, then the coming period will not be calm,” said Osama Mourad, chief executive of Arab Finance Brokerage.
Real estate developer SODIC booked the largest losses, down 9.7%, and investment bank EFG Hermes tumbled 9.2%.
Mourad said investors are also concerned about possible repercussions of the verdict, due on June 2, in the highly-charged trial of former president Hosni Mubarak.
In Saudi Arabia, the benchmark fell for a third session, down 0.4%, as trading volumes dropped to a four-month low.
Worries over the deepening eurozone debt crisis spurred investors to sell ahead of an expected summer lull on the kingdom’s bourse.
A total of 199mn shares changed hands, the lowest daily total since February 2.
“People have already started taking cash out of the market for the summer because they don’t know what will happen with Greece,” said Tarek al-Mady, a Riyadh-based independent financial analyst.
Saudi’s school holidays are expected to start early next month, which usually causes a 25%-30% drop in market activity.
“If there is clarity on Greece, prices in Saudi are very attractive to bring back the money,” said Al Mady.
Petrochemical and banking stocks headed losers, with Saudi Basic Industries Corp (Sabic) falling 0.8%. Arab National Bank slipped 2.3% and Bank Aljazira shed 3.2%.
Greece’s conservatives have regained an opinion poll lead that would allow the formation of a pro-bailout government committed to keeping the country in the eurozone, a batch of new surveys showed on Saturday.
In the UAE, Dubai’s bourse finished little changed, up 0.05% to 1,480 points. Trading volumes were the lowest since January 2 at 26.3mn shares. Abu Dhabi’s index slipped 0.2%, also in thin trade.
Retail investors have cashed in most of their gains from an early-year rally and institutions are largely absent while markets worldwide remain volatile due to the euro zone debt crisis.
Elsewhere in the Gulf, Oman’s index declined 0.5% to 5,682 points; Kuwait’s measure fell 1% to 6,277 points and Bahrain’s measure slipped 0.2% to 1,143 points.
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