Market watch: Concerns overshadow investor interest

Benchmark KSE 100-share Index drops 57.76 points

KARACHI: Rising political uncertainty and security concerns over Monday’s riot on a media house prompted investors to stay on the sidelines with volumes on the benchmark-100 index taking a dip Tuesday.

The KSE-100 Index ended just 57.76 points, or 0.15% lower, but trading was much more volatile than what the fall suggests.

A see-saw ride saw the index open negative, but quickly turn to the green and managing to stay there till half-time. But with locals awaiting clarity on the political front and futures rollover week under way, equities quickly lost momentum and closed negative for the fourth successive session.



At close, the Pakistan Stock Exchange (PSX) benchmark KSE 100-share Index ended at 39,400.19 points.

According to Elixir Securities, the start to the trading day was on a negative note as index heavy oils opened gap down tracking downtrend in global crude.

“The wider market struggled to find a clear direction in early trade as investors stayed on the side-lines monitoring developments on domestic political front after Monday’s unfortunate riot that prompted LEAs to arrest senior leadership of a political party and close their offices.

“The market, however, bounced back by mid-day as select financials pushed benchmark KSE-100 higher to test 39,600 levels on reported foreigners interest. Nonetheless, the index could not sustain gains as cements alongside with oils were a major drag on reported foreign selling amid no serious buying interest from locals.

“Engro Corp (ENGRO PA -1.1%) also remained out of favour on reported foreign selling and closed negative for the sixth consecutive session.”

“We expect volatile trading with participants closely monitoring foreigners activity in select sectors, key earning announcements due (Wednesday) of OGDC and HUBC and global crude to gauge market direction,” remarked Elixir Securities analyst Ali Raza.

JS Global analyst Nabeel Haroon said volatility prevailed as the index traded between an intraday high of 39,618 and intraday low of 39,363 points.



“Volatility prevailed as the futures rollover week continues. Investor interest was seen in the banking sector, as it closed marginally higher than its previous day close.

“HBL (+1.19%) and MCB (+1.18%) were the top performers of the aforementioned sector.

“Oil and Gas Development Company (OGDC -0.32%), Pakistan Petroleum Limited (PPL -0.72%) and Pakistan Oilfields (POL -0.13%) in the E&P sector lost value to close in the red zone, as global crude oil prices declined for the second consecutive day to trade below $47/bbl level.

“Moving forward, we expect market to remain volatile with a negative bias,” said Haroon.

Trade volumes fell to 173 million shares compared with Monday’s tally of 186 million.

Shares of 379 companies were traded. At the end of the day, 155 stocks closed higher, 209 declined while 15 remained unchanged. The value of shares traded during the day was Rs8.1 billion.

K-Electric Limited was the volume leader with 13.3 million shares, losing Rs0.06 to finish at Rs8.64. It was followed by Amtex Limited with 11.7 million shares, losing Rs0.41 to close at Rs2.13 and Media Times Limited with 8.2 million shares, gaining Rs0.18 to close at Rs1.90.

Foreign institutional investors were net buyers of Rs127 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, August 24^th, 2016.

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