Market watch: Bourse falls below 50,000 in another volatile session

Benchmark KSE-100 index decreases 204.48 points at 49,958

KARACHI: The bourse again witnessed volatile trading on Thursday as the index opened negative, posted a slight recovery, but failed to sustain the momentum, falling below 50,000 points.

At the end of trading, the benchmark KSE 100-share Index recorded a fall of 204.48 points or 0.41% at 49,958.33.

According to Elixir Securities, Pakistan equities closed lower on profit-taking after experiencing another volatile and dull trading session.

"The market opened on a negative note with index-heavy oil stocks leading early decline as investors tracked sharp overnight losses in global crude after a surprise rise in US stockpiles," said analyst Ali Raza.

"It was followed by a short-lived recovery on the back of gains in select index names including United Bank Limited (+0.1%) and Engro Corp (-0.5%) while select oil plays notably Pakistan Oilfields (-0.6%) and Pakistan Petroleum (-0.4%) also pared morning losses and aided the recovery."



The index, however, couldn't hold positive territory for long as investors resorted to profit-booking in the wider market.

At the day's close, the index settled below 50,000 with major dent coming from Habib Bank (-3%) on reported local selling.

"[We] see lacklustre trading on one-session Friday with flows mainly guiding the market direction. Volumes, however, are expected to pick up from next week as implementation of much-awaited leverage product gets under way," said Raza.

JS Global analyst Arhum Ghous said in line with expectations, the market remained volatile in Thursday's trading session, touching an intra-day high of +128 points and intra-day low of -287 points to close lower by 204 points at 49,958.



Major contribution to the index came from Searl (+1.88%), Hub Power Company (+0.71%) and MCB Bank (+0.49%) as they cumulatively contributed +35 points.

On the flip side, major laggards were Habib Bank Limited (-2.98%), DG Khan Cement (-2.09%) and Oil and Gas Development Company (-1.03%) as they cumulatively contributed -152 points to the index.

Heavyweights among commercial banks witnessed mixed investor sentiments with United Bank Limited, MCB Bank and National Bank of Pakistan (+1.02%) closing in the green while Allied Bank (-0.33%) and Habib Bank closing in the red zone.

"Oil and Gas Development Company, Pakistan Oilfields (-0.60%) and Pakistan Petroleum (-0.43%) lost value on account of 5% decrease in crude futures due to unexpected rise in US inventories," said Ghous.

The chemical sector performed well as opposed to the declining market with Engro Polymer and Chemicals (+5%) and Descon Oxychem (+5%) closing at their upper circuits.



"Moving forward, we expect the market to remain volatile and recommend investors to sell on strength."

Overall, trading volumes rose to 268 million shares compared with Wednesday's tally of 232 million.

Shares of 377 companies were traded. At the end of the day, 146 stocks closed higher and 217 declined while 14 remained unchanged. The value of shares traded during the day was Rs11.8 billion.

The Bank of Punjab was the volume leader with 25.9 million shares, losing Rs0.21 to close at Rs1.00. It was followed by Power Cement (right shares) with 25.6 million shares, losing Rs0.33 to close at Rs1.59 and Dost Steels with 22.5 million shares, gaining Rs0.58 to close at Rs14.76.

Foreign institutional investors were net buyers of Rs1.541 billion during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.