Stocks slide down on investor anxiety, lack of direction

Stocks lost almost one percent on Friday, dropping below the 39,000 points level, as lack of any positive developments kept the investors nervous putting blue chip exploration and production (E&P) and cement shares under pressure, dealers said.

Madiha Javed, head of research at Ismail Iqbal Securities, said, “Market remained under pressure throughout the session. With lack of any catalysts, volumes remained low with only 74 million shares traded today.”

Declining oil prices pressured E&P stocks with record US crude output and rising inventories limiting upside to crude prices. Autos continued to outperform the index after non-filers were allowed to buy locally-assembled cars irrespective of engine capacity, Madiha added.

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index lost 0.88 percent or 343.87 points to close at 38,950.23 points level. KSE-30 shares index followed suit with a low of 1.08 percent or 203.30 points to end at 18,580.37 points level.

Of 333 active scrips, 69 moved up, 237 retreated, and 27 remained unchanged. The ready market volumes stood at 73.984 million shares, as compared with the turnover of 83.156 million shares in the previous session.

Salman Ahmad, head of institutional sales at Aba Ali Habib, said reports from foreign media that chances of war between the two south Asian countries could not be ruled out threatened the sentiment at the stock market.

“Another rumour in the market, which dampened the mood of the investors, was that some high net worth individuals might have received notices from the tax authority to reveal the identity of their investors,” he said.

The market lacked any positive and supporting news which could halt the declining trend. The only good portent for the market was that the index went down in thin volume, this shows that a large group was still holding their portfolio for selling during better times, Salman added.

Investors totally ignored the fact of continuous appreciation in the local currency. The rupee in the shadows of the war hit 139.50 level; however, since last week it has been showing improvement. The currency went up almost by rupee one, which has been taken as a positive sign for the economy, an analyst said.

Three main passenger car assemblers, including Pal Suzuki, up Rs11.23/share, Indus Motors, up Rs66.21/share, and Honda, up Rs12.33/share, climbed on government removal of ban on non-filers, which restricted them from buying passenger cars.

Mutual funds and a majority of the commercial banks did not perform well either, dragging the index down.

The highest gainers were Phillip Morris Pakistan, up Rs148.99 to close at Rs3,128.89/share, and Bata Pakistan, up Rs87.54 to finish at Rs1,838.45/share.

Companies that booked highest losses were Pakistan Services, down Rs51.00 to close at Rs972.00/share, and Wyeth Pakistan Limited, down Rs22.66 to close at Rs1,200.67/share.

Bank of Punjab recorded the highest volumes with a turnover of 6.658 million shares. The bank’s scrip gained Rs0.02 to close at Rs13.86/share.

The lowest volumes were witnessed in WorldCall Telecom, recording a turnover of 12.473 billion shares, whereas the scrip lost Rs0.04 to end at Rs1.32/share.