Market watch: KSE-100 plunges close to 500 points in intra-day trading


KARACHI: The stock market recouped some of the losses as investors bought shares on dips after offloading in the final hour on rumours of Panama Papers case verdict that caused a decline of almost 500 points.

At close, the Pakistan Stock Exchange’s (PSX) benchmark KSE 100-share Index ended with a fall of 362.28 points or 0.73% to end at 49,392.44.

Earlier, stocks opened lower before investors opted to cherry-pick shares at attractive valuations. Volumes, however, remained lower and activity listless.

According to Elixir Securities, equities lost ground as aggressive institutional selling in the final 30 minutes of trading pulled the KSE-100 index down 1%.

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“Market opened lower with index-heavy oil stocks opening gap down and denting the KSE-100 index in early trade as investors tracked overnight losses in global crude after an unexpected surge in US stockpiles,” said analyst Ali Raza.

Oil and Gas Development Company (-2.3%) suffered most of the selling pressure followed by Pakistan Oilfields (-2%) and Pakistan Petroleum (-1.6%).

“Later on, selective institutional interest primarily in Habib Bank (+0.8%), Fauji Fertilizer Bin Qasim (FFBL, +1.7%) and Lucky Cement (+1.4%) helped the market to slowly recover and enter the green zone by midday,” said Raza.

The last 30 minutes, however, wreaked havoc as stocks tumbled on reports of aggressive local institutional selling in index names.

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“[We] expect volatile trading in the two-session Friday with participants closely tracking institutional flows to gauge market direction,” Raza added.

Meanwhile, JS Global analyst Nabeel Haroon said lacklustre activity prevailed in the market for most part of the day as volumes stood low and index continuously juggled between the positive and negative zones.

“Later on, heavy selling pressure was observed as investors came in to offload their holdings, eyeing political uncertainty and strong vigilance by the regulator (SECP) in the near future,” said Haroon.

“FFBL in the fertiliser sector extended its previous day’s gains on the back of news that there has been record DAP sales in February 2017. This increase in DAP sales was mainly due to aggressive buying by dealers in anticipation of increase in local DAP prices amid rising international DAP rates.”

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On the contrary, other fertiliser manufacturers lost value to close in the red zone on the back of market consensus that there would be a decline in urea sales numbers due to be released for February 2017.

Fauji Fertilizer Company (-1.49%) and Engro Fertilizers (-1.59%) were major losers of the sector, the analyst said.

“TPL (Trakker Ltd) gained to close at its upper circuit on the back of information disseminated yesterday (Wednesday) that its subsidiary TPL Life Insurance has submitted an application with PSX proposing initial public offering of its shares and listing on the PSX.”

“Moving forward, we expect volatility to persist in the market and recommend investors to stay cautious,” he added.

Trading volumes fell to 220 million shares compared with Wednesday’s tally of 245 million.

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Shares of 405 companies were traded. At the end of the day, 93 stocks closed higher, 294 declined while 18 remained unchanged. The value of shares traded during the day was Rs13.9 billion.

Azgard Nine was the volume leader with 12.3 million shares, losing Rs0.50 to close at Rs10.33. It was followed by Lotte Chemical with 11.1 million shares, losing Rs0.31 to close at Rs11.01 and K-Electric Limited with 10.4 million shares, losing Rs0.27 to close at Rs9.66.

Foreign institutional investors were net buyers of Rs689 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.

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