market watch: Stock market stumbles as rollover week begins
Benchmark KSE-100 index falls 118.07 points
Benchmark KSE-100 index falls 118.07 points.
KARACHI:
The stock market saw a massive 250-point decline half an hour after the trading began on Monday as investors brace themselves for a futures contract rollover week.
Weak crude oil prices and directives by US regulators to heavyweight Habib Bank’s New York branch pushed the index further into the red.
The Karachi Stock Exchange’s (KSE) benchmark 100-share index fell 0.36% or 118.07 points to end at 32,658.97.
According to JS Global analyst Arhum Ghous, the bourse remained under pressure during the trading session. “Major index movers were Habib Bank (-3.96%), OGDC (-1.13%) and Fatima Fertilizer (-0.97%).
“HBL continued to see selling pressure as investors remained concerned about the impact of the New York banking regulator’s action pertaining to its branch in New York.
“The downward spiral of global oil prices impacted exploration and production players like Oil and Gas Development Company (OGDC) and Pakistan Petroleum Limited (PPL). Sui Northern Gas Pipelines (+1.10%) gained as Ogra recommended an increase in its tariff by Rs107.81 per mmbtu (38%).”
According to the analyst, the market is expected to remain under pressure for the next two trading sessions ahead of the long weekend as this is a rollover week for futures contracts.
Topline Securities, in its report, stated that the downturn in international oil prices and a short futures rollover week ahead negatively affected market sentiments.
“Resultantly, the KSE-100 declined 118 points. Continued selling was seen in Habib Bank for a second consecutive session due to which the stock declined 4%.
“Lack of direction in international oil prices kept investors wary of oil stocks. OGDC, PPL and Pakistan Oilfields (POL) fell 0.7% to 1.3%.”
The news of Ogra’s approval of a summary for the increase in gas prices was expected to negatively affect profitability of textile companies going forward, it said. Nishat Mills declined 2.3% and Nishat Chunian was down 1.9%.
“Investors expect the aforementioned news and lower international prices of urea to affect profitability of local fertiliser manufacturers. Therefore, stocks like Fauji Fertilizer Bin Qasim, Engro Fertilizer and Fauji Fertilizer declined by 0.1% to 1%.”
Trade volumes fell to 90 million shares compared with Friday’s tally of 114 million.
Shares of 324 companies were traded. At the end of the day, 130 stocks closed higher, 166 declined and 28 remained unchanged. The value of shares traded during the day was Rs6.9 billion.
Habib Bank was the volume leader with 6 million shares losing Rs8.24 to finish at Rs200.08. It was followed by Baluchistan Glass with 5 million shares losing Rs0.67 to close at Rs6.64 and Pak Elektron with 4.7 million shares gaining Rs0.20 to close at Rs66.86.
Foreign institutional investors were net buyers of Rs62 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.
Published in The Express Tribune, December 22nd, 2015.
The stock market saw a massive 250-point decline half an hour after the trading began on Monday as investors brace themselves for a futures contract rollover week.
Weak crude oil prices and directives by US regulators to heavyweight Habib Bank’s New York branch pushed the index further into the red.
The Karachi Stock Exchange’s (KSE) benchmark 100-share index fell 0.36% or 118.07 points to end at 32,658.97.
According to JS Global analyst Arhum Ghous, the bourse remained under pressure during the trading session. “Major index movers were Habib Bank (-3.96%), OGDC (-1.13%) and Fatima Fertilizer (-0.97%).
“HBL continued to see selling pressure as investors remained concerned about the impact of the New York banking regulator’s action pertaining to its branch in New York.
“The downward spiral of global oil prices impacted exploration and production players like Oil and Gas Development Company (OGDC) and Pakistan Petroleum Limited (PPL). Sui Northern Gas Pipelines (+1.10%) gained as Ogra recommended an increase in its tariff by Rs107.81 per mmbtu (38%).”
According to the analyst, the market is expected to remain under pressure for the next two trading sessions ahead of the long weekend as this is a rollover week for futures contracts.
Topline Securities, in its report, stated that the downturn in international oil prices and a short futures rollover week ahead negatively affected market sentiments.
“Resultantly, the KSE-100 declined 118 points. Continued selling was seen in Habib Bank for a second consecutive session due to which the stock declined 4%.
“Lack of direction in international oil prices kept investors wary of oil stocks. OGDC, PPL and Pakistan Oilfields (POL) fell 0.7% to 1.3%.”
The news of Ogra’s approval of a summary for the increase in gas prices was expected to negatively affect profitability of textile companies going forward, it said. Nishat Mills declined 2.3% and Nishat Chunian was down 1.9%.
“Investors expect the aforementioned news and lower international prices of urea to affect profitability of local fertiliser manufacturers. Therefore, stocks like Fauji Fertilizer Bin Qasim, Engro Fertilizer and Fauji Fertilizer declined by 0.1% to 1%.”
Trade volumes fell to 90 million shares compared with Friday’s tally of 114 million.
Shares of 324 companies were traded. At the end of the day, 130 stocks closed higher, 166 declined and 28 remained unchanged. The value of shares traded during the day was Rs6.9 billion.
Habib Bank was the volume leader with 6 million shares losing Rs8.24 to finish at Rs200.08. It was followed by Baluchistan Glass with 5 million shares losing Rs0.67 to close at Rs6.64 and Pak Elektron with 4.7 million shares gaining Rs0.20 to close at Rs66.86.
Foreign institutional investors were net buyers of Rs62 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.
Published in The Express Tribune, December 22nd, 2015.