Market watch: Index suffers biggest one-day fall since mid-May

Benchmark 100-share index decreases 639.71 points.

KARACHI: The high seems to have been short-lived as the index suffered a massive decline on Monday, losing much of the shine gathered in the past few weeks with over a 600-point plunge.

While a lone reason could not be credited for the fall, which was the largest in weeks, analysts attributed the decline to the index tracking global markets, profit-taking and caution amid flood warnings.

At close on Monday, the Karachi Stock Exchange (KSE)-100 index, which neared the 35,000 level after closing above 36,000 the previous week, lost 1.79% or 639.71 points to end at 35,175.49.



Elixir Securities analyst Faisal Bilwani said equities ended negative with selling primarily observed in small and midcaps. “It was a day when the index lost most in a single day since mid-May this year,” said Bilwani. “Anxious retail investors attempted to offload in early trade anticipating declines during futures rollover week.

“However, no major buyers on system pulled most names deep in red while index stocks tracked wider market also to close the day negative.

“Institutional participation was very selective as index tracking funds reportedly were sellers while smart money kept a distance eyeing correction to the tune of 200-500 points before hunting bargains.”

Topline Securities said the market also remained under pressure due to the roll-over week.

“As a result, Pak Elektron Limited, ENGRO and DG Khan Cement declined by 2.3-3.8%.



“Falling crude oil prices affected index heavy oil stocks where oil and gas fell 2%. Small and midcaps like GAIL, NETSOL, CSIL, MERIT, BYCO and DCL that rallied in last few weeks fell sharply and closed at their lower limits.”

Shares of 389 companies were traded on Monday. Of these, 52 companies closed higher, 324 fell and 13 remained unchanged.

Trading volumes decreased to 570 million compared to 783 million on Friday.

Silk Bank was the volume leader with 66.6 million shares, losing Rs0.04 to close at Rs0.34. It was followed by Telecard Limited with 25.6 million shares, losing Rs0.93 to close at Rs4.86 and Pace (Pak) Limited with 24.8 million shares, losing Rs0.96 to close at Rs7.14.

Foreign institutional investors were net buyers of Rs99 million worth of shares during the session, according to data compiled by the National Clearing Company of Pakistan.

Published in The Express Tribune, July 28^th, 2015.

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