Tuesday, September 27, 2011

Global woes, oil weigh; Egypt bourse at 30-month low

Egypt's bourse slumped to a 30-month low on Sunday, leading a regional decline, with pressured world stocks dampening sentiment and a sharp decline in oil prices threatening local fundamentals.

Egypt's main index fell 2.4 percent to its lowest close since March 2009 — 4,233 points. — with investors wary of the uncertain political outlook in the North African country and discouraged by last week's fall in global markets.

US equities recorded their worst weekly loss on Friday since the 2008 financial crisis, hit by anxiety over the euro zone debt crisis and a warning about the US economy.

Saudi Arabia's petrochemical stocks pushed the index to its largest one-day decline in two weeks as investors worried about a squeeze on margins for chemical companies.

Crude fell to a six-week low on Friday on fresh concerns about Europe's ability to manage debt and a possible banking crisis. US November crude fell 66 cents to settle at $79.85, its lowest close since Aug. 9.

"So far, we believe fundamentals have been insulated from what's happening globally, given that oil prices until last week proved to be resilient," said Rami Sidani, Schroders Middle East head of investment.

"(But) if oil stays below $80 for an extended period of time, the investment for the region will be hampered... (since) government spending is the main economic driver." more