Market watch: KSE-100 dips 409 points as political tensions grow

Benchmark index decreases 1.02% to settle at 39,606.79

KARACHI: The stock market extended its bearish spell on Monday and fell over 400 points because of weak investor sentiments arising from multiple factors including growing tensions between India and Pakistan and FATF's comments on Pakistan government's efforts to comply with anti-money laundering and countering terrorism financing regulations.

On the political front, tensions boiled over following Islamabad High Court's rejection of former premier Nawaz Sharif's bail plea.

The benchmark index was also driven lower by a 20% month-on-month decrease in fertiliser sales for January 2019. Investor sentiments remained weak as the government continued to display slow progress towards an International Monetary Fund (IMF) bailout.



After a brief open in the positive zone, selling pressure emerged and investors resorted to profit-taking, leading to a steady decline in the bourse throughout the day. Timely gains were also witnessed but they were wiped out immediately.

At the end of trading, the benchmark KSE 100-share Index recorded a decrease of 409.34 points, or 1.02%, to settle at 39,606.79.

JS Global analyst Danish Ladhani said equities closed negative with the benchmark KSE-100 index shedding 409 points and closing at 39,607, down 1%.

"The bourse hit a high and low of +30 and -465 points respectively. Financial stocks were the major laggards among which Habib Bank (-2.6%), United Bank (-3.5%) and Bank AL Habib (-1%) closed in the red," he said.

Lucky Cement (-1.9%) and DG Khan Cement (-2.3%) also lost value. Indus Motor Company (-0.6%) reported 1HFY19 earnings per share of Rs87.94 with dividend per share of Rs25.

Habib Bank (-2.6%), United Bank (-3.5%), Hubco (-1.8%), Lucky Cement (-1.9%), Oil and Gas Development Company (-0.9%), Pakistan Petroleum (-0.9%), Engro (-0.7%) and Bank AL Habib (-1%) were among top stocks that cumulatively erased 228 points from the index.

Trading value came in at $26 million, down 33%, and volumes stood at 68 million shares, down 31%. Major contribution to the market volumes came from The Bank of Punjab (-4.2%), Siddiqsons Tin Plate (-2.5%), United Bank (-3.5%), Pak Elektron (-0.5%) and K-Electric (-0.5%).

"Going forward, we expect the market to remain volatile on geo-political concerns," the analyst added.



Overall, trading volumes decreased to 68.1 million shares compared with Friday's tally of 98.7 million. The value of shares traded during the day was Rs3.7 billion.

Shares of 346 companies were traded. At the end of the day, 105 stocks closed higher, 220 declined and 21 remained unchanged.

The Bank of Punjab was the volume leader with 12.23 million shares, losing Rs0.56 to close at Rs12.80. It was followed by Siddiqsons Tin Plate with 5.2 million shares, losing Rs0.53 to close at Rs20.8 and United Bank with 4.5 million shares, losing Rs4.91 to close at Rs137.21.

Foreign institutional investors were net sellers of Rs1.44 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.