The Egyptian ETF Plunges On Turmoil In Egypt (EGPT, VOD)

Today is bringing mass upheaval to Egypt. The markets are closed, but after yesterday’s plunge, Egyptian stocks are down a stunning 22%.

Since the Tunisian troubles started, the Cairo market has been on the defensive. Now there is talk of unrest from Libya to Yemen as the Arab world teeters on what could become transformative change.

To start with, everyone is talking about how phone lines are down and that from inside Egypt, the Internet has been effectively shut down. At least some Egyptian websites are still available from overseas, but the word on the ground is that the network within the country has been turned off — you may be able to look in, but you cannot look out.

Vodafone Group plc (NASDAQ:VOD) and Orascom Telecom Holding S.A.E (ORSTF.PK) have apparently been instrumental in shutting off the lines of communication. Neither of these companies have fared all that badly in ADR form — VOD is down 1% today, but thinly traded ORSTF is flat.

Within the Market Vectors Egypt Index ETF (NYSE:EGPT), the broad Egyptian ETF, both Commercial International Bank of Egypt, which trades in ADR form as Commercial International Bank (Egypt) S.A.E. (CIBEY.PK), and gold miner Centamin Egypt Ltd. (CELTF.PK) have been a lot less fortunate. Both are down around 22% with the broad market — in fact, given their weight within EGPT and the Cairo indices, in a sense they are the broad market.

Police lines are blocking public squares and some prayer sessions have been canceled.

Written By Tim Seymour From Emerging Money

Emerging Money provides insightful and timely information about the increasingly important world of Emerging Market investments. CNBC Emerging Markets Contributor Tim Seymour leads the team of Emerging Money to bring you cutting edge global news and analysis.

About Tim Seymour: Tim is a founder of Emerging Money. He is a founder and Managing Partner at Seygem Asset Management, and The Emerging Markets Contributor to CNBC. Seygem Asset Management focuses on investing throughout the global emerging markets asset class. With a view that emerging and developing economies will continue to outpace the economic growth and advancement of developed economies, Seymour has devoted a career to investing in the dominant markets of tomorrow, today. Seymour’s career has included significant experience in both alternative asset management (hedge funds) and capital markets, having launched two hedge funds, and built the largest Russian broker dealer in the USA. Seymour started his career at UBS, focusing on international credit (cash, swaps, forex) in a specialized hedge fund group (New York). Seymour completed the firm’s training program after graduating with an MBA in international finance from Fordham University. Seymour received his undergraduate degree at Georgetown University.

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