Egypt's stock market falls amid US recession fears, regional tensions
(MENAFN) On Monday, Egypt's main stock index dropped by 2.33 percent, closing at 27,840.6 points, as concerns over a potential U.S. recession and escalating regional conflicts weighed heavily on market sentiment. The U.S. unemployment rate surged to a three-year high of 4.3 percent in July, coupled with a significant slowdown in hiring, which has intensified worries about a weakening labor market and heightened recession risks. In Egypt, notable declines were seen across several major stocks: Eastern Company for Tobacco fell by 5.8 percent, Commercial International bank by 1.2 percent, El Sewedy by 6.4 percent, Madinet Misr for Housing and Development by 5.4 percent, Ezz Steel by 2.8 percent, Talaat Moustafa Group by 2.1 percent, and E-Finance for Financial Investments by 0.8 percent.
Regionally, tensions in the Middle East are rising as Israel and the United States brace for potential further escalation. This follows recent threats from Iran, Hamas, and Hezbollah in response to the recent killings of key figures in these groups. Mona Badir of Al Baraka Bank highlighted that geopolitical tensions are significantly impacting the Egyptian Stock Exchange and the local currency, with ongoing uncertainties adding to market pressure. She noted that the situation is fragile and the potential for further escalation is causing increased volatility in assets denominated in the local currency.
Badir also observed noticeable shifts, including substantial withdrawals from local debt instruments and financial assets in the Egyptian pound, reflecting the heightened regional risks. This trend is consistent with broader concerns about the stability of regional financial markets and the impact of geopolitical events on local economic conditions.
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