Market watch: Jittery investors offload as index endures wild swings

Benchmark KSE 100-share Index falls 0.07%

KARACHI: Marred with lack of positive sentiment and the ongoing Panama case hearing, stocks endured wild swings on Wednesday, with the KSE-100 Index ending 33.44 points down and below the 49,000 level.

However, the eventual decrease of 0.07% doesn’t even begin to tell the story. A positive open led the index to go as high as 49,331 before profit-taking and lack of interest led wiped off all intra-day gains.

The half-hour post 2pm saw an over 500-point fall before institutional buying pulled back the index into the green. It eventually finished almost flat, but in the red zone.

At close on Wednesday, the Pakistan Stock Exchange’s (PSX) benchmark KSE 100-share Index finished with a fall of 0.07% or 33.44 points to end at 48,981.65.



According to Elixir Securities, stocks traded in the green from the word go with index names, primarily MSCI EM stocks, leading the recovery in early trade.

“Mood turned sour by mid-day on lack of interest and no serious buyers on screen that pulled the market to tank by as much as 1.1% followed by another wave of rebound reportedly led by institutional buying with Index managing a close near 49,000,” said analyst Faisal Bilwani.

“The worst continued for mid- and small-cap speculative plays as they witnessed most selling reportedly from jittery retail investors as Court announced giving a verdict tomorrow (Thursday) on the ongoing Panama case while pressure from futures rollover further added to investors’ misery,” he said.



“K-Electric (KEL PA -1.6%) churned most volumes on reported selling from foreign institutional investors with local HNWIs increasing holdings over optimism on future outlook.

“[We] expect market to remain dicey and trade volatile with news flow from court proceedings guiding market direction. Moreover, institutional flows both local and foreign will also set the tone while we see limited participation from retail investors during the ongoing futures rollover week,” Bilwani added.

JS Global analyst Nabeel Haroon said the market opened on a positive note and rallied to make an intraday high of +316 points but selling pressure was witnessed in the market during the latter hours as the index fell to make an intraday low of -305 points.

“This selling pressure in the market was on the back of political uncertainty. However recovery was seen in the market at closing as the index closed on flat note at 48,982 level (-0.07%),” said Haroon.



“NBP (-1.21%) in the banking sector failed to sustain its ground against bearish sentiment in the market, as it lost value to close in the red zone on the back of almost flat core income posted in its 2016 result announcement.

“In its result, company posted EPS of Rs10.69/share along with a cash dividend payout of Rs7.5/share,” he added.

“On the other hand, SNGP (+2.34%) gained to close in the green zone as the gas utility posted profit for its second quarter of FY17 taking the total EPS for 1HFY17 to Rs5.68/share.

“Moving forward, we expect market to remain volatile and recommend investors to stay cautious in the ongoing futures rollover week,” he remarked.



Trading volumes rose to 379 million shares compared with Tuesday’s tally of 343 million.

Shares of 430 companies were traded. At the end of the day, 95 stocks closed higher, 320 declined while 15 remained unchanged. The value of shares traded during the day was Rs16.5 billion.

K-Electric Limited was the volume leader with 56.8 million shares, losing Rs0.16 to close at Rs9.65. It was followed Aisha Steel Mill with 34.2 million shares, losing Rs1.27 to close at Rs25.79 and Power Cement Limited with 24.5 million shares, losing 0.99 to close at Rs19.66.

Foreign institutional investors were net sellers of Rs124 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.