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00:00We will stay with the analysis of the performance of the Egyptian stock market for today's session with my guest from Cairo, Mr. Wael Aina, Deputy President of Tyco, and Investment Manager.
00:08Hello and welcome. Mr. Wael, let's start with you from the upheaval that took place in this session today after our absence in a holiday and our return.
00:16We opened on the side of the profit margin, then we were surprised by the market rising by 1% in most indicators. What happened?
00:24Three reasons led to the rise of the market in today's session. The first reason, this long holiday, there were orders to buy before the holiday.
00:34It was postponed until after the holiday in fear of any trouble during the holiday period. These are the first things, the orders to buy before the holiday entered the market today.
00:44The second thing, we said in the last episode with you that May this year will be different for the Egyptian market.
00:51We have positive events that will start to emerge. Indeed, the Fitch report turned the perspective of the future of Egypt from negative to positive in the asset class.
01:00Therefore, the perspective will be adjusted to the banks and to the assets of the State Trade Bank, which has the highest balance.
01:06The second news, we are waiting for it in May. We will go back to the Morgan Stanley indicator in the round review that will be held next week.
01:14The third news, the interest rate, the Central Bank will meet in May. I expect an increase or decrease in the interest rate. There is no increase.
01:22We increased by 8% in the first two meetings. I don't think there will be another increase.
01:26All these are positive news that led to the rise of the market. We can say that the great awareness that we lost last month, especially the negative events,
01:35led to a decline in the market today, considering what is happening on the borders between Hamas and Israel.
01:43Today, the market did not take any bank. On the contrary, it welcomed the news very normally.
01:49And it started to get difficult because these events were divided in the prices after the big crash.
01:55Do you think that we can wait until tomorrow to see if the geopolitical situation will get worse again?
02:04If there is any regional movement, will the Egyptian market take action based on real and serious news directly related to the Egyptian interior?
02:16Not on the sides, not just statements, and so on.
02:21If we wait until tomorrow, the political events will move to the next phase.
02:28I think that the negative phase in all the political events has ended today.
02:33I expect that the next phase will return to the negotiations.
02:37We will have positive news and this will have a positive effect.
02:42The market rose from the 1st of May, which is the Thursday, and today it rose.
02:47The rise was very strong, about 1,000 points.
02:50So, there may be profit-making operations, which is very normal and will give the market strength.
02:54But the investors started to trust the market.
02:57Purchasing operations started to happen.
02:59People started to talk about 31,000 points, and people started to talk about 30,000 points.
03:03I think that the psychological state of the negotiators started to change gradually.
03:09The more money is given out of the market, the more the market will rise.
03:14This is what happened.
03:15A lot of people left the market last month.
03:17So, the amount of money that is given out of the market is more than what is in the market.
03:21This is what led to the rise of the index in the last two sessions.
03:25Let's take some of the numbers.
03:27Today, the state trade rose 5%.
03:30What are the reasons behind this behavior?
03:34As I told you, the Fitch report is issued to the entire economy,
03:40and then it is issued to five major banks,
03:43the People's Bank, Cairo, Egypt, and the State Trade Bank, Alexandria.
03:47The State Trade Bank is the only private sector bank in the four banks,
03:51and the second private sector bank is Alexandria-San Paolo, which is a private sector bank.
03:55So, everyone expects that the next report will be a report on the banks.
04:01So, if there is a positive view of the economy, there will be a positive view of the banks.
04:05The second thing is that, as I told you, next week there will be a report on Morgan Stanley.
04:11Morgan Stanley has suspended the Egyptian index for one reason.
04:14In the last comment, he said that he will suspend the index until the problem of the exchange rate is solved.
04:20We used to have two prices, 30 in the banks and 70 outside the banks.
04:23Now, the price is unified outside the banks, like inside the banks, 47, 48.
04:28Therefore, the reason we suspended the index is solved.
04:32Therefore, I expect that we will return to the indicators.
04:35Of course, the State Trade Bank occupies the highest weight in Morgan Stanley's indicators,
04:39as it occupies the highest weight in the Egyptian index indicators.
04:42So, I expect that this is a competitive rise that is happening at the moment,
04:46and that it will continue.
04:47For this reason, some analysts see that we are going to a point of 31,000 points,
04:51and that it is due to profit-generating processes, and this is very normal in the market.
04:56Mr. Wael, let's go to the listed stocks,
04:59where there are changes in the market value,
05:02and it is starting to give us a breath of relief from the rise,
05:06especially with reports that the numbers of inflation
05:10will begin to take a path of shrinking from its highest levels.
05:14What are the listed stocks that are returning to their normal price?
05:21Because even now, there are many stocks that are still floating in terms of inflation.
05:25When will we return to the point of saying that the market has adjusted from the prices,
05:29and we will prove it for a good period of time?
05:34The entire real estate sector, Ms. Rola.
05:37This sector may have recovered significantly.
05:39As you said, the share price of Mostafa reached 105 pounds last month.
05:45Last month, it dropped to 50 pounds.
05:47This means that it has recovered by 50%.
05:49So, if it goes up from 50% again to 100%, it will go up 100%.
05:53And just like Balm Hills, Eymar, New Egypt, and Nasr City,
05:57these companies and these stocks have recovered by about 50%.
06:01So, I expect that the real estate sector is the sector that can respond
06:06and bring profit to investors to enter this area.
06:10The second thing in this sector is that we are starting to see the purchase of treasury stocks.
06:14I mean, Mostafa went out and sent a message to buy a treasury stock.
06:17A thousand messages.
06:18In view of the rise in the share price in this area, I buy a treasury stock.
06:22I expect that other companies will also decide to buy a treasury stock.
06:26This means that the money outside the market will enter the market.
06:29I mean, Mostafa went out and bought 10 million shares for half a billion pounds.
06:33This will bring half a billion pounds from outside the market and enter the market.
06:36This will make the market profitable in general.
06:38I expect other companies to buy a treasury stock,
06:40just like what happened with ASIC for refining and the announcement today
06:43about the purchase of 2 million shares.
06:45But with your permission, I ask the Stock Exchange Administration
06:48to reconsider the principles of purchasing a treasury stock.
06:52Because the message that is sent to buy a treasury stock is rubbery.
06:55I will buy even a number of 10 million shares.
07:00I can buy one or two shares.
07:02Like the idea of stores when they make a discount.
07:04They tell you that the discount is up to 70%.
07:06When you go in, you will find that the discount is 5% or 10%.
07:09Therefore, the principles of purchasing a treasury stock must be modified
07:12by forcing the company to buy the number that it will say.
07:16You do not say that you want to buy as long as you do not have the desire or the ability.
07:19Especially after the new modifications that have been made.
07:21Especially after the new modifications that have been made.
07:24According to the new modifications that have been made today and the new laws.
07:28I thank you for your time and my guest from Cairo, Mr. Wael Inaba.
07:31You are the vice-president of Tyco, the administration of the treasury and the investment banks.