Stocks continue to drop for third day this week

Benchmark KSE-100 index loses 233 points


Our Correspondent March 15, 2017
PHOTO: FILE

KARACHI: The stock market continued to fall on Wednesday, experiencing third consecutive day of decline in the current week.

At close, the Pakistan Stock Exchange's (PSX) benchmark KSE 100-share Index recorded a fall of 233.23 points or 0.48% to finish at 48,305.83.

Elixir Securities analyst Ali Raza said the market lacked direction with banking stocks taking a serious hit.

"The wider market struggled to find a clear direction and traded in a narrow range on limited participation, with no concrete update on the much-awaited leverage product and upcoming verdict on Panama case among possible reasons of anxiety among locals," he said.

"Banking stocks took a plunge on reported institutional selling with the trio of index-heavy United Bank (-3%), Habib Bank (-1.3%) and MCB Bank (-0.5%) cumulatively contributing more than half of the (index's) decline."

Dramatic day as KSE-100 recovers to close 117 points down

Hub Power (-1.2%) too came under pressure after the company notified investors of its intention to divest 40% stake in Thar Energy, a wholly owned subsidiary. It offered 30% equity stake to Fauji Fertilizer Company (+0.7%) and 10% to China Machinery Engineering Corporation (CMEC).

JS Research analyst Arhum Ghous in his report commented that volatility prevailed in the Pakistan bourse as the KSE-100 index oscillated between an intra-day high of +228 points and intra-day low of -329 points.

Volume leader K-Electric (-4.29%) and Sui Southern Gas Company (-1.09%) closed in the red zone following a news report that the Abraaj Group would not be able to conclude the power utility's deal with Shanghai Electric Power within the stipulated time frame.

This was because of the company's failure to settle financial dues with SSGC and National Transmission and Despatch Company (NTDC) and it would now require an extension.

Stocks take another beating, KSE-100 falls 536 points

Moreover, Pak Elektron Limited (-1.53%) lost value as the company declared its year-end results for 2016, posting earnings per share of Rs7.51, which was lower than street estimates. It declared a final cash dividend of Rs1.75 per share.

"Moving forward, we expect volatility to prevail in the market and recommend investors to stay cautious," said Ghous.

According to Topline Securities, Cherat Cement announced expansion plans with the installation of production line 3. The plant will have production capacity of 7,100 tons per day. This led to 1.6% gain in the company's stock.

Overall, trading volumes rose to 206 million shares compared with Tuesday's tally of 195 million.

KSE-100 gains 302 points, closes at 49,754

Shares of 386 companies were traded. At the end of the day, 132 stocks closed higher, 238 declined while 16 remained unchanged. The value of shares traded during the day was Rs10.89 billion.

K-Electric was the volume leader with 47.6 million shares, losing Rs0.43 to close at Rs9.15, followed by Aisha Steels with 11.2 million shares, gaining Rs0.02 to close at Rs22.6 and Power Cement Limited with 9.6 million shares, losing Rs0.33 to close at Rs19.08.

Foreign institutional investors were net sellers of Rs683 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.

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