Small- and mid-cap shares lead the advance as investors assess a stronger currency, IMF financing and the return of stamp duty
CAIRO — Egyptian equities opened August with a broad advance on Sunday, lifting market capitalization above EGP4tn as smaller companies outperformed blue chips and the pound recovered against the US dollar amid improving market sentiment.
The benchmark EGX30 rose 1.58% to 54,285.86 points, reversing the previous session’s decline and closing comfortably above the 54,000 mark. Gains were even stronger across the broader market, with the EGX70 Equal Weight Index surging 4.39% to 19,034.28 points, while the EGX100 Equal Weight Index climbed 3.83% to 24,956.02 points.
The EGX33 Shariah Index advanced 2.64% to 6,171.57 points, while the EGX35-LV gained 2.98% to 6,503.58 points. Total market capitalization increased by approximately EGP84bn to EGP4.021tn, reflecting one of the strongest single-session recoveries in recent weeks.
The rally extended across virtually the entire market. Official Egyptian Exchange statistics showed 189 advancing shares against 24 decliners, confirming that buying was broad-based rather than concentrated in a handful of heavyweight stocks.
Small-Caps Continue to Outperform
The session reinforced a trend that has characterised the market in recent weeks: sustained outperformance by small- and mid-cap companies.
The EGX70’s 4.39% gain was nearly three times the increase recorded by the EGX30, while the EGX100 also significantly outpaced the benchmark. The divergence indicates that investor appetite continues to broaden beyond Egypt’s largest listed companies toward domestically oriented growth stocks.
Since the beginning of the previous trading week, the EGX30 has gained roughly 1.6%, compared with approximately 6.6% for the EGX70 and 5.3% for the EGX100, underscoring continued momentum across smaller companies.
Trading activity remained robust, with turnover reaching approximately EGP10.4bn, supported by strong market participation and positive breadth, suggesting that Sunday’s advance reflected genuine buying interest rather than low-volume price movements.
Institutional Investors Add Support
Regular-session trading data, excluding negotiated transactions and broader deal classifications used in some market summaries, showed Egyptian investors as net buyers of approximately EGP81mn, while non-Arab foreign investors recorded net purchases of about EGP22mn. Arab investors were net sellers by roughly EGP103mn.
Although retail investors continued to account for the majority of market activity, institutional investors also increased exposure during the session. Egyptian institutions recorded the largest net purchases, while foreign institutions also remained modest buyers, providing additional support to the rally.
The broader pattern is consistent with recent market research published by EFG Hermes, which suggests that improving macroeconomic stability and stronger corporate earnings are gradually encouraging investors to broaden exposure beyond traditional blue-chip stocks. The brokerage also notes that sustaining higher market valuations will depend increasingly on institutional participation and continued implementation of structural economic reforms rather than retail liquidity alone.
Healthcare and Cyclical Shares Lead the Advance
Healthcare stocks again featured prominently among the session’s strongest performers.
GlaxoSmithKline Egypt rose by the daily limit of 20% to EGP 287.71, while Egyptian International Pharmaceutical Industries Company (EIPICO) also advanced 20% to EGP124.80. Misr Duty Free Shops gained 19.99% to EGP55.77.
EIPICO, which recently commissioned a new biologics and biosimilars manufacturing facility valued at more than US$100mn, remained one of the market’s most closely watched pharmaceutical stocks as investors continue to monitor Egypt’s expanding pharmaceutical manufacturing sector.
Among larger-cap companies, Telecom Egypt advanced around 9.2%, Alexandria Mineral Oils Company (AMOC) gained 7.5%, and Egyptian Chemical Industries (KIMA) rose 6.2%.
The breadth of gains across healthcare, telecommunications, energy, industrial and property shares suggests Sunday’s rally was supported by multiple sectors rather than a single investment theme.
Pound Recovery Improves Market Sentiment
The Egyptian pound strengthened noticeably during the session.
According to the Central Bank of Egypt, the average exchange rate improved to approximately EGP50.36 per US dollar for buying and EGP50.46 for selling, compared with levels above EGP51 at the end of the previous week.
The currency’s recovery followed an easing in immediate geopolitical tensions after the United States signalled that negotiations with Iran would continue rather than proceeding with additional military action. Lower oil prices also reduced concerns over renewed inflationary pressures across energy-importing economies.
For international investors, a firmer pound enhances US dollar-denominated investment returns and reduces one of the principal risks associated with investing in Egyptian financial assets.
IMF Financing Reinforces Confidence
Sunday’s trading also followed the International Monetary Fund Executive Board’s completion of Egypt’s seventh review under the Extended Fund Facility and second review under the Resilience and Sustainability Facility, unlocking approximately US$1.8 billion in additional financing.
While the decision strengthens Egypt’s external financing position and reinforces confidence in the country’s reform programme, the IMF reiterated that continued fiscal discipline, exchange-rate flexibility and faster implementation of state-ownership reforms remain essential for sustaining macroeconomic stability and attracting long-term private investment.
For equity investors, the IMF’s decision reinforces the policy framework underpinning Egypt’s economic reform agenda while maintaining pressure for continued structural reforms.
Stamp Duty Introduced Without Immediate Market Disruption
Sunday’s rally came immediately before the operational collection of Egypt’s reinstated stamp duty on listed securities.
Under Law No. 153 of 2026, transactions in listed securities are subject to a 0.5 per thousand levy on both buyers and sellers, with a reduced 0.25 per thousand rate applying to same-day trading. Licensed market makers remain exempt.
The strength of the market suggests investors did not initially view the measure as sufficient to alter the broader investment outlook. Nevertheless, its longer-term impact on liquidity—particularly among active retail traders—will become clearer only after several weeks of trading under the revised framework.
Treasury Auctions Reflect Strong Demand
The Central Bank of Egypt, acting on behalf of the Ministry of Finance, also conducted auctions for 91-day and 273-day Treasury bills that attracted demand above the initial target, according to published auction data.
The result points to continued investor demand for short-term government securities while highlighting the competition Egyptian equities continue to face from high-yielding sovereign debt in attracting domestic institutional capital.
Outlook
Sunday’s advance demonstrated that investor confidence remained resilient despite the introduction of stamp duty, continued Treasury issuance and lingering geopolitical uncertainty. Broad market participation, institutional buying and renewed strength in the Egyptian pound combined to provide a constructive backdrop for equities at the start of August.
The durability of the rally will now depend on whether second-quarter corporate earnings, sustained institutional participation and continued macroeconomic stability reinforce the recent improvement in sentiment. Progress on Egypt’s state-owned enterprise listing programme, together with further capital-market reforms, will also be closely watched as investors assess whether the Egyptian Exchange can extend gains beyond the recent retail-led recovery.
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