Egypt come in as best performers among regional peers reflecting investor optimism-

The first week of August saw diverse performances among the regional indices, reflecting mixed investors’ sentiments regarding the general prevailing investment atmosphere. Over the week, Egypt came in as the best performer among its regional peers with a 2.8% gain, continuing its upward inclination that it started in late June with a low of 6,851, and breaking the 8,000 level up, showing a 20% increase since then.

This reflects investors optimism about the Egyptian market on the back of the announced IMF visit to Cairo to discuss a USD12 billion loan, that is to be repaid over 3 years and also the news about the upcoming devaluation that is expected to take place soon.

On the other hand, Oil remained the major driver for GCC indices, with Dubai, Abu Dhabi, Saudi Arabia coming down for the week by 1.3%, 1.5% and 1.4% respectively. With oil hovering around USD40 per barrel, investors are being cautious about when and where to invest. 

Saudi Aramco, the world’s largest oil exporter, lowered the pricing terms for Arab Light crude sold to Asia by the most in 10 months, signalling that Saudi Arabia has no plans to back down while OPEC rival Iran tries to regain market share amid a global oversupply, putting pressure on oil prices outlook and consequently investors’ sentiment in the region. 

Summer volumes are in full effect hindering any significant price activity so the coming week may see further listless trading unless we see the rise of meaningful triggers such as the one being used in Egypt right now.