KSE continues to fall amid thin trading

Uncertainty over flood damage haunts market

KARACHI: The stock market dropped for the fourth day in a row as volumes tumbled during trade on Thursday, the first day of Ramazan, with investors resorting to selling after disappointing result announcements.

A dull day was witnessed at the Karachi Stock Exchange (KSE) as the benchmark 100-share index fell by 82.87 points or 0.84 per cent to close at 9,792.81 points.

Only 25.54 million shares were traded during the first day of the shorter market timings introduced for Ramazan, more than 58 per cent fall compared with Wednesday’s volume of 61.5 million shares.

Shares of 327 companies were traded. At the end of the day, 121 stocks closed higher while 184 declined and 32 remained unchanged. The value of the shares traded during the day was Rs1.03 trillion.

“Energy companies led by OGDC borne the brunt of the selling pressure after result announcement by the country’s largest oil and gas explorer failed to beat expectations,” according to Jawad Khan of JS Global Capital Limited. The price of company’s stock fell by Rs2.84 to close at Rs138.12 at the end of the day’s trade.

Arif Habib Securities (AHSL) emerged as the market leader with 5.47 million shares traded during the day. The scrip lost five per cent to close at Rs28.56 per share because of an unfavourable result announcement.

“AHSL saw heavy battering on below expectation result and closed at its lower circuit breaker,” highlighted an analyst.

Dera Ghazi Khan Cement followed with a trade volume of 2.23 million shares. The stock price went up by Rs0.27 to close at Rs25.21 per share.

Jahangir Siddiqui and Company remained on number three for the second day as far as volumes are concerned. Around 1.57 million shares were traded and the stock closed at Rs11.22 after a drop of 2.35 per cent during the day’s trade.

“Although volumes usually drop during Ramazan because of the shorter trading day, the recent trend in the market is due to the uncertainty of the actual damage caused by the floods,” commented Farhan Mahmood, an analyst at Topline Securities. He added that the trend is likely to continue during Friday’s trade.

Published in The Express Tribune, August 13^th, 2010.