First Semester Yields Losses In Excess Of LE 88 Billion

The year’s first semester has come to its end, and despite the fact that some markets have started to show mild signs of recovery, the Egyptian stock market stands among the semester’s biggest losers. During the first six months of the year, Egypt’s market capital has gone down more than LE 88 billion; its indexes have naturally followed suit, registering drops of 12% to 25% on average.

Evidently, the effects of the world’s latest recession has been a major blow for the Egyptian stock market; final bankruptcy rulings have increased in 235% with respects to last year (from January to May, a total of 57 companies filed for bankruptcy; last year the number stood at just 17).

By the end of 2010’s first semester, the market’s value stood at a total LE 488.2 billion; today it stands at LE 399.7 billion, thus confirming what has been said. The volatility that the market has experienced during the past year (mostly due to problems in the Middle East, in Greece, and in Egypt itself) has undoubtedly taken a significant toll on the Egyptian market and its economy as a whole.

The outlook looks grim for Egypt at present, but specialists believe that the market will manage to rally during the second half of the year. As political developments unfold in the country and as optimism sweeps through the market (as Greece’s outstanding debt problem appears to be resolved), it is likely that the market will manage to recover its losses.