Market watch: Fertiliser, oil bear the brunt as index dips below 49,000

Benchmark KSE 100-share Index falls 173.62 points

KARACHI: The benchmark-100 index dipped below the 49,000-point level, losing 173.62 points on Tuesday as index-heavy oil stocks and fertiliser scrips bore the brunt soon after the opening bell.
The index lost over 350 points soon after the session began, but recovered to end with a 0.35% fall.
The bearish spell largely originated from the fertiliser sector as news reports revealed that the fertiliser subsidy announced during FY17’s federal budget had been exhausted, a scenario which will likely cause fertiliser prices to rise in the future. Mid-day news, however, suggested that the price increase would be much sooner than expected.
Excitement also came from the textile sector as exporters welcomed the much awaited textile package
At close, the Pakistan Stock Exchange’s (PSX) benchmark KSE 100-share Index recorded a fall of 0.35% or 173.62 points to end at 48,865.79.

Market watch: In a first, index finishes over 49,000

Elixir Securities analyst Faisal Bilwani said Pakistan equities closed negative after trading in a narrow range of 350 points.
“Stocks opened lower primarily on losses in index heavy oils that tracked lower global crude, while fertiliser plays also dented benchmark KSE-100 in early trade with a gap down open on panic after government withdrew subsidy on urea and DAP.
“Fauji Fertilizer (FFC,-2.8%) closed in red on trimmed losses while Engro Fertilizer (EFERT,-5%) traded most since listing in 2014 with over 36 million shares exchanging hands on reported local activity,” said Bilwani.
“Wider market witnessed selective interest with textiles bringing excitement near close of trading as government announced much awaited incentives package for the ailing industry.”
JS Global analyst Nabeel Haroon said negativity prevailed in the market as the index lost 174 points.
“Pressure was witnessed in the fertiliser sector on the back of news that the federal government has withdrawn subsidy extended to the sector,” said Haroon.
“EFERT (-4.99%) and Fatima Fertilizers (-4.98%) were major losers of the aforementioned sector,” said Haroon.
“Textile sector extended its gains as long-awaited export package of Rs180 billion was unveiled by the government.”
Trading volumes fell to 413 million shares compared with Monday’s tally of 492 million.
Shares of 417 companies were traded. At the end of the day, 199 stocks closed higher, 205 declined while 13 remained unchanged. The value of shares traded during the day was Rs20 billion.
Engro Fertilizer was the volume leader with 36.1 million shares, losing Rs3.66 to finish at Rs69.62. It was followed by Azgard Nine with 33.9 million shares, gaining Rs0.47 to close at Rs10.34 and K-Electric Limited with 28.9 million shares, gaining Rs0.03 to close at Rs9.35.

Foreign institutional investors were net sellers of Rs535 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.