Market watch: Politics keeps investors away, index falls 35 points

Trade volume drops to a meagre 54 million shares.

KARACHI:

Equity prices dipped for a second consecutive day at the Karachi Stock Exchange (KSE), as political tension and speculation over new taxes kept investors away from assuming fresh positions in the market.

The benchmark KSE-100 index peaked at 12,000 points during intraday trade, but by the end of the trading session, bears prevailed over bulls, as the index shed 35 points to close at 11,940 points.

“Investors steered clear of fresh positions, despite renewed foreign interest in blue-chip stocks and higher global prices of oil and other commodities,” said Arif Habib Investments Director Ehsan Mehanti.

He added that local participants had opted to wait for the outcome of a meeting between Muttahida Qaumi Movement and President Asif Ali Zardari. “Renewed political tensions in Sindh have unnerved investors in the past two trading sessions,” he said.

A dismal trade volume of 54 million shares was witnessed in the broader market, down from Monday’s tally of 117 million shares. “This has been the lowest level of participation we have seen in the past two weeks,” highlighted Topline Securities equity dealer Samar Iqbal. “Activity was mainly confined to low-cap stocks,” she added.

The broader market appeared neutral, as out of a total of 655 actively traded companies, 110 closed higher while 154 declined. Share prices of 391 companies remained unchanged.

Nimir Ind. Chemical was the volume leader with 7.86 million shares, gaining Rs0.26 to finish at Rs2.9. It was followed by JS Bank Ltd with 6.92 million shares, losing Rs0.01 to close at Rs3.1, and Lotte Pakistan PTA with 3.38 million shares, gaining Rs0.02 to close at Rs15.59.

Published in The Express Tribune, March 9^th, 2011.