When Egypt’s stock market finally reopens, nobody doubts what will happen: prices will tumble. That’s probably why the day of reckoning got postponed again on Wednesday, when the Cairo stock exchange delayed its reopening for the umpteenth time until next week.The longer the market is closed, the more jittery and frustrated some investors get – although others seem glad to defer the pain. For neighbouring stock markets, however, the impact of Egypt’s closure has been inescapable.
Mohamed Ebeid, managing director and head of western institutional sales at EFG-Hermes in Cairo, told beyondbrics:
Some fund managers are facing outflows from their funds, but they can’t price or sell Egyptian equities. So in that case they have to sell in other markets to raise the capital. This is why there is a spillover effect in other Middle East markets, which are under pressure anyway due to expectations that political pressures will spread.
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