Market watch: Political noise drags KSE-100 further down ahead of long break

Benchmark index falls 345.53 points to close at 45,288.49

KARACHI: Adhering to its norm, the stock market continued its downward journey on Friday as the political climate kept the bourse under pressure.

The KSE-100 index fell from the word go, but managed to recover slightly before midday break. However, in the later session, the index again fell to finish trading in the red zone.

At close, the benchmark KSE 100-share Index recorded a decrease of 345.53 points or 0.76% at 45,288.49.

According to Elixir Securities, Pakistan equities extended losses on Friday with the benchmark KSE-100 index dipping further to 45,300 points.

"Activity in the wider market also painted a dreary picture with only 114 million shares changing hands on the KSE All-share Index, down 35% versus Thursday and 46% versus this week's average," stated Elixir.

The market traded in the negative territory from the word go as index names across major sectors carried bearish momentum and slid lower in dull trading.



"Institutional investors likely refrained from participating aggressively in the wake of domestic political noise while most retail investors also preferred to stay on the side-lines ahead of long holidays," the report added.

Engro Foods (-5%) hit its lower price limit after posting poor results while Habib Bank (-1.2%) too traded in the red after announcing slightly lower-than-expected quarterly earnings.

"(We) expect stocks to remain under pressure on political noise with cleric Tahirul Qadri announcing a sit-in in Lahore on Wednesday while the ruling PML-N is expected to continue to aggressively defend ousted PM Nawaz," Elixir said.

"We see investors to take cue from and closely track political developments over the long weekend."

JS Global analyst Maaz Mulla said the bourse witnessed another dreary session as the index lost 345 points and closed at 45,288.
HBL (-1.41%) from the commercial banking sector posted its 1H2017 results with earnings per share (EPS) of Rs11.64, down 2% year-on-year, and a dividend per share of Rs3.50. Also results for Engro Foods (-5%) for 1H2017 were unveiled, in which the company announced EPS of Rs0.24, down 91% year-on-year.
"The result was below our expectations," Mulla remarked.


Pakistan Oilfields Limited (POL, -1.98%), Pakistan State Oil (-2.16%) and Lucky Cement (-1.19%) were the big losers that cumulatively dragged down the KSE-100 index by 67 points.
Out of commercial bank heavyweights, HBL, United Bank (-0.85%) and MCB Bank (-0.76%) cumulatively erased 76 points from the KSE-100 index.

Oil and Gas Development Company (-1.20%), POL and Pakistan Petroleum (-1.80%) lost points as US crude futures for September delivery came down 0.76% at $48.20 a barrel, the lowest since July 26.
"Political situation is expected to keep the market under pressure for as long as it doesn't settle, which is why we still recommend a cautious approach," Mulla added.

Overall, trading volumes fell to 113 million shares compared with Thursday's tally of 175 million.

Shares of 351 companies were traded. At the end of the day, 134 stocks closed higher, 199 declined while 18 remained unchanged. The value of shares traded during the day was Rs6.04 billion.

Azgard Nine was the volume leader with 18.6 million shares, gaining Rs0.82 to close at Rs16.59. It was followed by TRG Pakistan with 6.2 million shares, gaining Rs0.83 to close at Rs44.66 and Aisha Steel Mills with 5.3 million shares, gaining Rs0.29 to close at Rs22.73.

Foreign institutional investors were net sellers of Rs235 million during the trading session, according to data compiled by the National Clearing Company of Pakistan Limited.