KARACHI: Stocks tumbled on Thursday with the benchmark index closed at a 17-month low level as investors fled risky assets amid uncertainty about the ongoing political standoff in Islamabad, dealers said.
“Bears opened the floodgates where the (benchmark) index crashed to close at a 17-month low,” Topline Securities said in its post market note. “An amalgamation of local politics, where opposition political parties are allegedly planning a sit-in against Model Town Tragedy, geopolitics where US decision to make Jerusalem the capital of Israel…. domestic individuals panicking over upcoming change in trading Circuit Breaker rules, along with overnight dip in crude oil prices, have all culminated towards this sell-off, we believe.”
Pakistan Stock Exchange’s (PSX) KSE-100 shares index shed 2.81 percent or 1,122.66 points to close at 38,784.66 points. The KSE-100 index was 38,368 points on July 11, 2016. KSE-30 shares index shed 3.35 percent or 670.87 points to close at 19,325.97 points. As many as 363 scrips were active of which 46 advanced, 301 declined and 16 remained unchanged.
The ready market volumes stood at 163.26 million shares as compared with the turnover of 149.572 million shares a day earlier. Analysts said the market still seemed to grapple with low investor demand, who anticipated the onslaught from macro-economic imbalances but not quite sure when and whether this would happen. “Investors seem to have taken backseat in view of the developing situation,” an analyst said.
Ali Raza at Elixir Securities said equities lost ground with benchmark index sinking primarily on political noise. “Market opened lower and declined steadily with sentiments mainly dented as cleric Tahir-ul-Qadri hinted at a protest against government over Model Town incident issue while opposition parties PTI and PPP also pledged their support for the protest call.”
What started as a knee-jerk reaction to
rise in political noise in early trading turned into a full-blown hammering across the board as the day progressed with notable blue-chips skidding lower and leading the declines and institutional sellers struggling to offload amid no serious buyers on the screen.
Both Sui Northern Gas Co (SNGP), down 5.0 percent and Kot Addu Power Co (KAPCO), down 5.0 percent extended sharp losses for the third day; former on uncertainty over proposed return by oil and gas regulator and latter on concerns that power purchase agreement extension is unlikely beyond FY21 and deal with Hub Power (HUBC), down 3.1 percent, may not materialise.
Going forward, analysts see volatile trading and market likely remaining under pressure on caution over domestic politics. Companies reflecting highest gains include Unilever Foods up Rs50 to close at Rs7,000/share and Island Textile up Rs41.62 to close at Rs874.12/share.
Companies reflecting most losses include Khyber Tobacco down Rs58.45 to close at Rs1,500.5/share and Sanofi Aventis down Rs37.27 to end at Rs1,382.73/share. Highest volumes were witnessed in K-Electric with a turnover of 13.72 million shares. The scrip shed 41 paisas to close at Rs6.23/share. Worldcall Telecom was second with a turnover of 12.85 million shares. It shed 19 paisas to close at Rs3.0/share. Dewan Cement was third with a turnover of 9.78 million shares. It gained 92 paisas to finish at Rs15.07/share.