So, When Will the Egypt Stock Exchange Open?
By: As late as Monday, officials from the Egypt stock exchange maintained that the stock market would open Tuesday. Then came a last-minute call to push the date for the resumption of trade to next week.
It's not the first time officials try to buy more time in an effort to avert an expected sell-off. It was already clear back when I was on the ground in Tahrir Square.
Now the exchange has been closed for more than a month during which much has changed in the Middle East and North Africa.
But it's probably the knowledge that most of these developments have not been priced in that's spooking the management of the Egyptian stock exchange.
Trading was suspended on January 27 after the benchmark index fell over 10 percent.
Since then, President Hosni Mubarak stepped down after almost 30 years in power, the military has taken over, the constitution was suspended, the parliament dissolved and the ‘political contagion' has spread from Egypt to Yemen, Bahrain, Algeria, Morocco, Iran, Oman and Iraq, and there is talk of demonstrations in Saudi Arabia.
It doesn't end there.
The government of Colonel Muammer Ghaddafi in neighboring Libya is now on the brink of collapse, while the threat of a broader civil war looms.
Stock markets in the Gulf reacted with losses across the board during February, with the Saudi stock exchange, the largest in the region, losing some 6.6 percent. In Tuesday's trading session alone, the market lost almost 7 percent.
Officials say that trading on the Egypt stock exchange will resume on Sunday, allowing the bourse to refine measures to support small investors caught out by falling shares prices, according to Reuters.
In other steps, trade would be suspended for 30 minutes if the index decline by 3 percent and for the remainder of the session if it falls by 6 percent. It's unrealistic that those steps will prevent panic-selling.
Will they postpone again, come Sunday? Probably, but the prospect of prolonged geopolitical turmoil in the region does not translate into an ability to buy time in little increments.
In retrospect, keeping the stock exchange closed may have been a prudent decision if the domestic and regional political situation had stabilized.
However, it's only gotten worse since. And with every day it remains closed, the region's oldest stock exchange will lose credibility among domestic and foreign investors alike.
And that takes longer to fix.
