Market watch: Stocks fall over 500 points with low volumes

Benchmark KSE-100 Index loses 1.3% to settle at 40,316.93

KARACHI: The stock market opened the week on a negative note as ongoing political drama pulled the index down by over 500 points.

Soon after the trading began on Monday, the index fell and maintained a steady decline through the day. Volumes stood low as a lack of any positive triggers and continuing sit-in by religious parties in Islamabad kept investors on the sidelines.

At close, the benchmark KSE 100-share Index registered a decrease of 527.47 points or 1.29% to settle at 40,316.93.

Elixir Securities, in its report, stated Pakistan equities traded first day of the week negative as the benchmark index slid around 1.3% to settle just above 40,300 points.

"The market witnessed a dull trading session with volumes and turnover on both benchmark indices dipping as investors traded selectively in the absence of near-term triggers," stated the report.

Moreover, a prolonged sit-in by religious parties near the federal capital calling for the removal of law minister over alleged amendment to the Khatm-e-Nabuwat clause in the Election Act 2017 contributed to the anxiety of investors.



Among key sectors, only oil stocks stood strong and supported the index, but that too in early trading. The initial surge following weekend gains in global crude prices gave a good excuse to investors to book profits in the sector.

"(We) expect the weakness and volatile trading to persist in the near term with institutional activity both from locals and foreigners being the only saviour in coming days," the report added.

JS Global analyst Danish Ladhani said the KSE-100 index opened positive but remained under pressure throughout the day.

Amreli Steels closed positive (+0.02%) after the company announced that it was entering into a joint venture agreement with publicly listed Chinese company Qingdao Huijintong Power Equipment Company to diversify into the electrical transmission business.

The banking sector maintained its previous trading day's trend where big banks such as National Bank (-1.92%), United Bank (-0.90%) and Habib Bank (-0.68%) lost value.

Moreover, the exploration and production sector also fell where Oil and Gas Development Company (-0.85%), Pakistan Oilfields (-1.43%) and Pakistan Petroleum (-0.41%) were major laggards due to pressure in international crude oil markets.



Oil marketing companies continued to receive a battering and Pakistan State Oil (-3.19%) being the major supplier of furnace oil closed in the red.

"Moving forward, we recommend investors to stay cautious at current levels where any upside can be considered as an opportunity to reduce short-term positions or book profits," Ladhani said.

Overall, trading volumes fell to 94 million shares compared with Friday's tally of 115 million.

Shares of 350 companies were traded. At the end of the day, 68 stocks closed higher, 258 declined while 24 remained unchanged. The value of shares traded during the day was Rs4.3 billion.

TRG Pakistan was the volume leader with 13 million shares, losing Rs1.55 to close at Rs35.24. It was followed by Dost Steels with 8.1 million shares, gaining Rs0.12 to close at Rs13.42 and Azgard Nine with 6.3 million shares, losing Rs0.56 to close at Rs15.10.

Foreign institutional investors were net buyers of Rs188.2 million during the trading session, according to data compiled by the National Clearing Company of Pakistan.