Egypt stocks gain, traders see rally fizzling out

Rallies by some of the stocks worst hit by Egypt's political turmoil send the benchmark index up 1.5 per cent, but traders say declines are likely later in the week. Property developers Talaat Moustafa and Palm Hills Development gain 2.9 per cent and 6.6 percent respectively. Ezz Steel jumps 5.7 per cent. The Egyptian Exchange reopened on March 23 after a popular uprising forced Hosni Mubarak from the presidency. The stock market was shut for more than seven weeks.

"The stocks have been badly hit by political turmoil and people are making use of cheap prices," says Teymour el Derini from Naeem Brokerage. "We are expecting a correction to this rally sometime this week as buying power weakens. The market is likely to make a correction down to the 4,200 level," says Ossama Naguib from Arab Finance Brokerage. The EGX30 is at 5,542 points. Index heavyweight Commercial International Bank (CIB) is up 1.8 per cent.