Market watch: Stock market starts week on disappointing note

Benchmark KSE-100 Index falls 356.18 points to close at 42,911.02

KARACHI: The stock market had a disappointing start to the week with political uncertainty cited as the major dampener.

The benchmark index lost 356.18 points during Monday's trading session as investors stood on the sidelines. Heavyweight sectors including banks and oil exploration and production companies were major losers of the day.

At close, the benchmark KSE 100-share Index recorded a decrease of 0.82% to settle at 42,911.02.

JS Securities analyst Danish Ladhani said Pakistan equities closed negative with the benchmark index settling at 42,911, down 0.8%.

The market kicked off on a positive note, gaining 223 points, but later it came down due to sell-off by institutions as Adviser to the Prime Minister on Finance Miftah Ismail confirmed that Pakistan would be placed on grey list of the Financial Action Task Force (FATF) in June.



Heavyweights namely Habib Bank (-1.34%), Oil and Gas Development Company (-1.47%), United Bank (-1.28%), Pakistan Petroleum (-2.22%), MCB Bank (-0.34%), Engro (-1.77%), Lucky Cement (-1.73%) and Hubco (-1.32%) cumulatively contributed 230 points to the index's decline.

Traded volumes plunged 31% to 168 million shares while traded value dropped to $65 million. Top volume stocks were Dost Steels (-5.06%), Azgard Nine (-3.52%), Fauji Foods (+3.47%), Bank Alfalah (-0.15%) and TRG Pakistan (+5%).

Mixed sentiments were seen in the auto sector where Millat Tractors (+0.87%), Ghandhara Industries (+5%) and Indus Motor (+0.65%) closed in the green.

Ghandhara announced its 1HFY18 results, posting earnings per share of Rs42.63 with no cash payout.

In the auto sector, the Commerce Division issued the much-awaited Statutory Regulatory Order (SRO), clearing the way for release of thousands of three-year-old used cars stuck at ports, following change in the Import Policy Order.

Banks were mostly negative where Habib Bank (-1.34%), United Bank (-1.28%), MCB Bank (-0.34%) and Askari Bank (-4.13%) led the decline.

Askari Bank announced full-year 2017 standalone earnings of Rs4.18 per share, up 1% year-on-year, with no cash payout.

Bank Alfalah (-0.15%) also announced its 2017 results where the bank posted earnings per share of Rs5.21 and declared cash payout of Rs1.50 per share.



Furthermore, Pak Elektron (-5%) closed at its lower circuit as the company and Kohinoor Power were debarred from World Bank-funded projects.

"Moving forward, we expect the market to remain volatile with flows from local institutions and foreigners guiding direction," Ladhani added.

Topline Securities said the stock exchange saw another day of dull trading with low participation and selling in index-heavy sectors, including banks and exploration and production companies, forcing the market to close lower.

"Rising political uncertainty also kept investors on the sidelines," its report said. "NAB has started investigating the Punjab Land Development Company on likely corruption cases. Opposition parties have also raised eyebrows over the alleged involvement of Punjab government in the cases."

Overall, trading volumes fell to 167 million shares compared with Friday's tally of 244 million.

Shares of 348 companies were traded. At the end of the day, 139 stocks closed higher, 197 declined while 12 remained unchanged. The value of shares traded during the day was Rs7.17 billion.

Dost Steels was the volume leader with 22.4 million shares, losing Rs0.67 to close at Rs12.58. It was followed by Azgard Nine with 11.5 million shares, losing Rs0.62 to close at Rs17.01 and Fauji Foods with 11.5 million shares, gaining Rs0.88 to close at Rs26.25.

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