KARACHI: On the back of an uncertain political situation and a trading imposition on one of the leading brokerage house, the index plummeted but managed to remain above the 31,000-point barrier. The decline comes after days of exceptional performance that saw the index cross the 32,000 level, recording new highs every day.
At close on Thursday, the Karachi Stock Exchange’s (KSE) benchmark 100-share index fell 1.63% or 517.25 points to end at 31,239.04.
Elixir Securities analyst Sibtain Mustafa said the index plunged owing to revision in debt market rates in the Pakistan Investment Bond auction.
“The sentiment was further dented over rumours squaring of leverage positions from a leading brokerage house which faced trading restrictions from the regulator.
“Mutual funds with constant proportion portfolio insurance component also divested their respective positions owing to re-balancing strategy.
“Opening over low volumes, the index soon turned negative as losses from Wednesday’s session soon gained momentum.
“Engro (-4.56%), Nishat Mills Limited (-4.23%), Lucky Cement Limited (-3.48%) soon hit their respective lower circuits intra-day on institutional selling.
“Day traders and punters also squared positions due to rising political heat as Imran Khan called for a gathering on November 30, 2014.”
JS Global analyst Muhammad Mobeen said the negative sentiment in the market was due to the recent developments within the political setup as confrontation between the government and PTI ignited once again.
“Profit-taking was also witnessed by the investors across the board as one of the corporate brokerage houses has been forcefully suspended, causing panic selling.”
Trade volumes fell to 253 million shares compared to 282 million on Wednesday.
Shares of 394 companies were traded on Thursday. Of these, 310 companies declined, 71 closed higher while 13 remained unchanged. The value of shares traded during the day was Rs13.3 billion.
Hum Network Limited was the volume leader with 26.1 million shares, losing Rs0.61 to close at Rs16.39. It was followed by Jahangir Siddiqui and Company with 22.8 million shares, losing Rs0.45 to close at Rs14.84 and Maple Leaf Cement with 19.3 million shares, losing Rs0.58 to close at Rs34.02.
Foreign institutional investors were net buyers of Rs255 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan Limited.
Published in The Express Tribune, November 21st, 2014.
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