Market watch: Lacklustre trading continues as index slips further

Benchmark index decreases 364.5 points to settle at 37,853.57

KARACHI: The stock market continued to experience dull trading just before the end of calendar year 2018 with the index maintaining its losing streak for the second successive session and slipping below the 38,000-point barrier.

Despite a brief open in the positive on Thursday, the KSE-100 index continued to lose ground as investor interest remained weak. The trading session was dominated by negative sentiments due to a lack of triggers and weak macroeconomic indicators.

Selling pressure in banks added to the poor sentiments. Meanwhile, exploration and production (E&P) stocks performed well following an increase in international crude oil prices.

At the end of trading, the benchmark KSE 100-share Index recorded a decrease of 364.5 points or 0.95% to settle at 37,853.57.

Elixir Securities' analyst Murtaza Jafar said after opening up, the equities could not sustain the momentum and gradually slid through the day with a spike in selling pressure in the final trading hours.



"The benchmark KSE-100 eventually closed the day down 0.95% - a sharp contrast to major positive moves witnessed in global markets," said Jafar.

"International crude oil gained nearly 5% since the close of PSX on Wednesday (after adjusting for Thursday's correction of around 2%), this allowed domestic E&P stocks to gain in early trading hours but they succumbed to selling pressure later."

Oil and Gas Development Company (+1.1%) closed up while Pakistan Petroleum Limited (-0.7%) and Pakistan Oilfields Limited (+0.3%) closed relatively flat. Mari Petroleum (-1.6%) remained under pressure as the government gave the nod for its secondary public offering.

The biggest dent to the index came from the banking sector as Habib Bank Limited (-2.2%), Bank AL Habib (-3.7%), United Bank Limited (-2.2%) and Bank Alfalah (-4.3%) collectively contributed over 140 points to the decline in KSE-100.

"Things didn't remain too calm on the political front either as the government placed former president Asif Ali Zardari on the exit control list due to ongoing graft cases against him," Jafar said.



"We expect the market to consolidate at current levels (supports defined at 37,600-37,800) as investors await next round of negotiations between the government and the International Monetary Fund in mid-January," he added.

Overall, trading volumes increased to 103.7 million shares compared with Wednesday's tally of 88.6 million. The value of shares traded during the day was Rs4.55 billion.

Shares of 361 companies were traded. At the end of the day, 101 stocks closed higher, 239 declined and 21 remained unchanged.

Bank Alfalah was the volume leader with 7.2 million shares, losing Rs1.99 to close at Rs43.87. It was followed by The Bank of Punjab with 5.7 million shares, losing Rs0.14 to close at Rs12.72 and Aisha Steel Mills with 5.4 million shares, gaining Rs0.17 to close at Rs10.55.

Foreign institutional investors were net buyers of Rs70.1 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.