Stocks fall as political unrest spooks investors

Stocks dropped 1.3 percent on Monday as investors opted to remain on the sidelines over upcoming political street protests due this week, dealers said.

Analyst Ahsan Mehanti at Arif Habib Corp said stocks fell sharply lower with concerns on economic uncertainty and ongoing political noise. “Political protests due this week, dismal trade deficit data for July-December 2017 and investor concerns over weak Pak-US relations played a catalytic role in the bearish close at the PSX,” the analyst said.

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index fell 1.37 percent or 586.23 points to close at 42,347.49 points. Intraday high was 42,933.72 points while the lowest level of the day was recorded at 42,270.10 points.

KSE-30 shares index shed 1.43 percent or 310.67 points to close at 21,360.34 points. Turnover decreased by 108 million shares to 130.47 million shares against 238.67 million shares last week on Friday. Trading value dropped to Rs5.81 billion from Rs10.32 billion, while market capital fell to Rs8.80 trillion from Rs8.90 trillion in the last session. Out of 356 companies’ active in the session, 95 closed in green, 249 in red while 12 remained unchanged.

Topline Securities in a post market note said the participation receded significantly as volumes fell 44 percent and traded value was down 45 percent. Jawwad Abubakr, analyst at Elixir Securities, said trading activity diminished as investors opted to stay on the sidelines ahead of scheduled protest by a united opposition led by religious party cleric Tahir ul Qadri.

Financials were in pressure since the opening bell as profit-taking by institutional investors continued in index heavy United Bank Limited, down 2.3 percent and Habib Bank Limited, down 2.2 percent.

Later, oils and fertilisers also joined the club with Fauji Fertilizers, down 3.3 percent, Pakistan Oilfields, down 3.1 percent, and Pakistan State Oil, down 3.2 percent, denting KSE100 index the most.

However, Lucky Cement, up 0.2 percent and Engro Corp, up 0.7 percent remained in green most of the day with reported foreign buying. The national carrier and retails' favourite stock, Pakistan International Airlines closed up 23 percent at its upper circuit after the minister of state hinted at its privatisation before the present government finished its tenure.

Highest increase was recorded in shares of Bhanero Textile, which rose Rs39.99 to Rs839.98/share, followed by Khyber Tobacco that increased by Rs31.38 to Rs659.12/share. Major decline was noted in shares of Bata Pakistan, which fell Rs120 to Rs2,400/share, followed by Pak Tobacco that decreased Rs50.74 to Rs2,092.73/share.

Significant turnover was recorded in stocks of Azgard Nine, TRG Pak Ltd, Pakistan International Airlines, Pak Elektron, Aisha Steel Mill, Sui Southern Gas Company, K-Electric, Sui Northern Gas Pipelines, Dewan Cement and Inter Steel.

Azgard Nine remained the volume leader with 19.07 million shares. It increased 32 paisas to close at Rs13.97/share. It was followed by TRG Pak Ltd with 8.55 million shares. It shed Rs1.64 to finish at Rs31.25/share. Shares’ turnover in the future contracts dropped to 33.68 million shares from 67.86 million shares traded in the previous session.