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Egypt exchange plunges on reopening after uprising

 A trader works during Egypt's stock exchange market session after it's reopening after a nearly two-month closure, in Cairo, Egypt  Wednesday, March ...
 A staff member of Egypt's stock exchange follows a monitor at the trading hall during it's reopening session after a nearly two-month closure, in Cai...
 Two staff members of Egypt's stock exchange follow a monitor at the trading hall during it's reopening session after a nearly two-month closure, in C...
 Two Staff members of Egypt's stock exchange market congratulate each other during it's reopening after a nearly two-month closure, in Cairo, Egypt  W...
 Egyptian army soldiers guard the entrance of Egypt's stock exchange, background, during it's reopening session after a nearly two-month closure, in C...
 Egypt's stock exchange market's celebrates it's reopening after a nearly two-month closure, in Cairo, Egypt  Wednesday, March 23, 2011. Egypt's bench...

Mideast Egypt Economy

A trader works during Egypt's stock exchange market session after it's reopening after a nearly two-month closure, in Cairo, Egypt Wednesday, March ...

Mideast Egypt Economy

A staff member of Egypt's stock exchange follows a monitor at the trading hall during it's reopening session after a nearly two-month closure, in Cai...

Mideast Egypt Economy

Two staff members of Egypt's stock exchange follow a monitor at the trading hall during it's reopening session after a nearly two-month closure, in C...

Mideast Egypt Economy

Two Staff members of Egypt's stock exchange market congratulate each other during it's reopening after a nearly two-month closure, in Cairo, Egypt W...

Mideast Egypt Economy

Egyptian army soldiers guard the entrance of Egypt's stock exchange, background, during it's reopening session after a nearly two-month closure, in C...

Mideast Egypt Economy

Egypt's stock exchange market's celebrates it's reopening after a nearly two-month closure, in Cairo, Egypt Wednesday, March 23, 2011. Egypt's bench...

Shares on Egypt's stock exchange plunged by about 10 percent within seconds of the market's reopening Wednesday after a nearly two-month closure stemming from the mass protests that toppled former President Hosni Mubarak.
Trading was temporarily halted shortly after the market reopened once the declines exceeded pre-set limits put in place to slow any sharp selloffs.
The Egyptian Exchange has been closed since Jan. 27 as the demonstrations paralyzed the Arab world's most populous nation.
Although rapid, the drop did not come as a surprise. Analysts had expected sharp losses as investors pulled their money from the market amid ongoing investigations of former regime officials and some of the country's top businessmen whose companies are listed on the exchange.
"I was not surprised at all. It's something to be expected give the market was offline for 7 weeks," said John Sfakianakis, chief economist for the Riyadh, Saudi Arabia-based Banque Saudi-Fransi, of Wednesday's plunge. "The situation in Egypt has not created confidence among international and of course local investors."
The exchange's benchmark EGX 30 index fell 9.9 percent to trade at 5,086 points.
Egyptian officials had tried to shore up confidence ahead of Wednesday's reopening, including the appointment of a new temporary head following the resignation of the bourse's former chairman.
Several companies announced plans to buy back shares in an apparent effort to try to prop up prices and stem any losses. Topping the list was property developer Amer Group, which planned on buying 101 million of its shares, according to an exchange statement.
Sfakianakis said he believes the selloff was "healthy" because too much selling pressure had been built up due to the market's prolonged closure.
"Steam has to be released," he said, adding that further declines are likely in the coming days.
Most other Mideast markets were down by only a fraction of a percentage point.
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Adam Schreck contributed reporting from Dubai, United Arab Emirates


Updated : 2021-04-15 17:13 GMT+08:00