The Egyptian Exchange (EGX) took a steep dive last Thursday, closing deep in the red as local investors initiated broad-based selling across all sectors, dragging every major index sharply downward. The EGX30 benchmark index slipped 1.29% to settle at 32,511.68 points, while the EGX33 Shariah index fared worse with a 1.86% drop.
Small and mid-cap equities suffered the most, with the EGX70 plunging by 2.63% to 9,605.19 points, and the broader EGX100 index tumbling 2.31% to close at 13,070.09. Total market capitalization contracted to 2.3 trillion Egyptian pounds, reflecting the gravity of Thursday’s losses.
According to EGX data, Egyptian investors were heavy net sellers, offloading stocks worth nearly EGP 19.77 billion. In contrast, Arab and foreign investors seized the opportunity to buy the dip, pumping in EGP 6.49 billion and EGP 13.28 billion, respectively — a move analysts suggest reflects confidence in Egypt’s long-term fundamentals amid short-term volatility.
“Egyptian investors appear to be cashing out either to secure profits or due to a broader risk-off sentiment,” said financial analyst Yasmine El-Gendy of Cairo Capital Markets. “Meanwhile, foreign institutions view this correction as a buying window — particularly in resilient sectors like infrastructure and fertilizers.”
Despite the market-wide downturn, a handful of stocks defied the broader sentiment. El Kahera El Watania Investment emerged as Thursday’s star performer, soaring by 19.98% to EGP 36.09 per share — likely driven by renewed investor interest in diversified investment vehicles amid economic uncertainty.
Samad Misr – EGYFERT climbed 10.57% to EGP 166.80, benefiting from the global fertilizer demand uptrend. Similarly, Misr Beni Suef Cement posted a solid 3.69% gain, trading at EGP 131.34, as the construction sector shows signs of steady recovery on the back of government infrastructure projects.
Steel and industrial stocks bore the brunt of the decline. Misr National Steel – Ataqa fell a staggering 10.41% to EGP 10.76, leading Thursday’s losers. Upper Egypt Flour Mills declined by 7.24%, closing at EGP 430.20, amid speculation of rising operational costs and narrowing margins. El Arabia Engineering Industries also slumped 5.85% to EGP 1.77.
“These declines reflect broader economic anxieties, particularly around input costs, energy prices, and inflation,” commented Dr. Hani Sabry, an economic advisor at Al Ahram Center for Political and Strategic Studies. “But institutional foreign buyers jumping in is a sign that this may not be a long-term trend.”
Experts point to a combination of factors: mainly social as the Eid Break celebrations may have led various investors into selling, persistent inflationary pressure, interest rate volatility, and expectations of subsidy reforms following Egypt’s new IMF-backed economic restructuring program. The Central Bank of Egypt (CBE) recently signaled it may maintain its hawkish stance to anchor inflation expectations — a move that could cool down equity appetite among local investors.
Moreover, investor caution ahead of the upcoming corporate earnings season and geopolitical tension in neighboring regions have added to the jitters.
While short-term volatility is expected to continue, analysts believe the underlying fundamentals of several sectors remain robust, particularly in exports, fertilizers, logistics, and renewable energy. Foreign institutional interest could offer a stabilizing force, though much will depend on Egypt’s macroeconomic signals in the coming weeks.
In the words of Rami Abdel Aziz, head of research at Beltone Financial: “This correction is not unexpected given recent rally highs. The key now is policy clarity — on subsidies, energy pricing, and interest rate trajectory. Once that becomes clearer, we expect a return of confidence.”
As Thursday’s trading shows, investor sentiment on the EGX remains deeply reactive to macroeconomic shifts. While the sell-off led by Egyptian investors raises questions, the counterbalance from foreign buyers indicates that confidence in Egypt’s medium-term potential is still intact.
