KSE-100 Index down as MCB sustains selling pressure

The Karachi Stock Exchange’s (KSE) benchmark 100-index dropped on sales in index heavy weight MCB Bank, a dealer said on Friday.
“Due to decline of 2.5 percent in index heavy weight MCB, Karachi stock market closed in negative. Investors sold MCB after news of exclusion of the stock from FTSE emerging markets index. MCB loss contributed 60 points in the index fall,” said Samar Iqbal at Topline Securities.
“FTSE is a very import index that foreign portfolio investors follow to make investment and divestment decisions internationally,” she said.
United Bank Limited (UBL) and Oil and Gas Development Company Limited (OGDC) were the two other heavy-weight stocks that were also subject to low volume sales.
However, notable buying in a couple of cement, power and fertiliser stocks refrained a bigger fall in the index. Such stocks were included DG Khan Cement, Fauji Cement, Hub Power Company, and Fauji Fertilizer Company.
The KSE 100-Index dropped by 105.18 points, or 0.32 percent, to 33,263.66 points. During the session, the index moved both sides of the fence by 239.54 points – between intraday high of 33,473.37 points and intraday low of 33,233.83 points.
KSE 30-Index dipped 92.48 points, or 0.42 percent, to close at 21,694.97 points.
Volumes shrank 24 percent to 134.73 million shares. Trading value was cut by nine percent to Rs8.289 billion. And, market capitalisation fell by Rs41 billion to Rs7.47 trillion. Of a total of 343 active stocks, 184 closed with decrease in their prices, 138 closed with increase, and 21 closed with no change.
Samar said cement stocks invited renewed buying on reports of surge in dispatches.
“The winter season is near its end during which construction activities remain low,” she added.
She said Pakistan State Oil rallied 1.3 percent as February oil sales grew by 18 percent from the previous month, which increased expectations of better earnings this quarter.
Car assemblers Indus Motor Company and Pak Suzuki Motor rose amid expectations of improved car sales during February and depreciation of Japanese Yen against US dollar.
Expected cut in benchmark policy rate in the upcoming monetary policy will be the trigger to an upward movement, she added.
Ahsan Mehanti at Arif Habib Corporation said blue-chip stocks invited sales in the post-results announcement season. However, institutional buying in leveraged cement, fertiliser and energy stocks supported the index to have closed well above intraday low, he added.
“Leveraged stocks invited buying on speculation of interest rate cut by the central bank in its next monetary policy announcement likely in mid of this month,” Mehanti said.
Jahangir Siddiqui and Company was the volume leader with 15.25 million shares, as it closed at Rs17.99 with a loss of Re1.
This was followed by Pak Elektron with 12.57 million shares, which closed at Rs55.90 with a gain of 82 paisas. K-Electric recorded trade in 9.71 million shares, as it ended at Rs7.66 with a drop of 34 paisas.