Market watch: Stocks fall ahead of upcoming MSCI review

Benchmark index decreases 292.55 points to settle at 41,096.33

Our Correspondent November 12, 2018

Benchmark index decreases 292.55 points to settle at 41,096.33. PHOTO: PPI / FILE

KARACHI: The stock market experienced a bearish session as investors were concerned about the potential removal of some large-cap stocks from the MSCI Emerging Markets index in an upcoming review.

Despite a positive open, the KSE-100 index failed to sustain the momentum as selling pressure pushed the index down by 336 points in intra-day trading. Additionally, lack of any news on progress in talks with the International Monetary Fund (IMF) also kept activity subdued.

At the end of trading, the benchmark KSE 100-share Index recorded a decrease of 292.55 points or 0.71% to settle at 41,096.33.

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Elixir Securities' analyst Murtaza Jafar said the benchmark KSE-100 index traded under pressure due to the lack of triggers, though the Ministry of Finance discussed a bailout package with the IMF in Islamabad.

"Rounds of selling kept investors at bay in index-heavy blue chips as announcement of the MSCI Semi Annual Review was due on November 13. We expect Lucky Cement (-3.9%) to be downgraded from the MSCI Emerging Markets index to the small-cap index while United Bank Limited (-2.6%) remains a borderline case," Jafar added.

Both the stocks remained under pressure throughout the day and accounted for a decline of 90 points in the KSE-100 index as investors preferred to reduce allocations ahead of the announcement of the review.

"We expect the market to find support around 40,500-40,700 as details of the bailout package emerge out of the ongoing talks with the IMF," Jafar said.

Market watch: KSE-100 flat amid lack of positive triggers

Overall, trading volumes decreased to 178 million shares compared with Friday's tally of 219.6 million. The value of shares traded during the day was Rs6.7 billion.

Shares of 368 companies were traded. At the end of the day, 111 stocks closed higher, 242 declined and 15 remained unchanged.

K-Electric Limited was the volume leader with 17.7 million shares, losing Rs0.06 to close at Rs6.02. It was followed by Lotte Chemical XD with 15.9 million shares, gaining Rs0.46 to close at Rs18.10 and Siddiqsons Tin Plate with 12 million shares, losing Rs0.10 to close at Rs18.84.

Foreign institutional investors were net sellers of Rs225 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.