KARACHI: In something that is becoming a norm, the KSE 100-share Index continued to decline for the fifth straight session on Tuesday, plunging about 1,763 points in intra-day trading.
After a brief positive session in the first hour, the index went on a continuous downward trajectory, pushed by institutional selling and uncertainty in domestic politics because of ongoing proceedings of the Joint Investigation Team in the Panama Papers case.
At the end of trading, the benchmark KSE 100-share Index recorded a fall of 1,678.90 points or 3.60% to close at 44,914.44.
Elixir Securities, in its report, stated that Pakistan equities tanked as institutional selling in the wider market dragged the benchmark index below 45,000 points.
“The market, after opening and trading in the positive territory for a brief period, skidded lower on thin volumes in the first two hours of trading. This was followed by sharp declines as institutional investors, primarily locals, turned aggressive sellers in index names on rumours of large redemptions and prevailing concerns over domestic politics,” stated the report.
Notable blue chips across major sectors closed at or near their lower price limits with major dent coming from Habib Bank (HBL, -4.9%), Oil and Gas Development Company (OGDC, -4.8%), MCB Bank (-5%), Engro Corp (-4%), Lucky Cement (-3.5%) and Pakistan Petroleum (PPL, -4.6%).
At Tuesday’s close, the KSE-100 index is now down approximately 15% or 8,000 points from its peak in May 2017 and 11.2% or 5,700 points post-MSCI Emerging Markets upgrade, Elixir said.
“[We] expect the volatile market to possibly see a bounce back in remaining days of this short week, but turnover and (real) interest are likely to improve only after Eid holidays,” the report added.
JS Global analyst Arhum Ghous said a bloodbath was witnessed at the Pakistan bourse because of aggressive selling in the latter hours that dragged down the benchmark index by 1,679 points to 44,914.
“Commercial banks led the decline as sector heavyweights HBL (-4.9%) and MCB Bank (-5%) lost value to close at or near their lower circuits. After gaining a few points on account of investor interest, oil stocks declined as well after international crude prices came down to around seven-month low,” said Ghous.
OGDC (-4.8%), Pakistan Oilfields (-4.2%) and PPL (-4.6%) from the above sector cumulatively contributed -199 points to the KSE-100 index.
As the textile industry was observing a black day on Tuesday in protest against what it said were anti-industry policies of the government, Nishat Chunian (-5%) and Nishat Mills (-5%) shed value.
Trading volumes increased to 295 million shares from 170 million shares a day ago as local investors redeemed their positions.
“The market is expected to further decline in coming days, therefore, we recommend investors to stay cautious at current levels and reduce short-term holdings on strength,” he added.
Overall, trading volumes rose to 294 million shares compared with Monday’s tally of 170 million.
Shares of 386 companies were traded. At the end of the day, 25 stocks closed higher and 343 declined while 18 remained unchanged. The value of shares traded during the day was Rs9.1 billion.
The Bank of Punjab (R) was the volume leader with 47.7 million shares, losing Rs0.04 to close at Rs0.05. It was followed by K-Electric with 25 million shares, gaining Rs0.04 to close at Rs6.95 and Askari Bank with 13.9 million shares, losing Rs0.85 to close at Rs18.56.
Foreign institutional investors were net buyers of Rs241 million during the trading session, according to data compiled by the National Clearing Company of Pakistan Limited.
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