Market watch: Stocks shed 281 points in absence of triggers

Benchmark index decreases 0.82% to settle at 34,190.62

Our Correspondent June 25, 2019
Benchmark index decreases 0.82% to settle at 34,190.62. PHOTO: AFP

KARACHI: The stock market extended its losses from the previous session on Tuesday and shed 281 points because of absence of positive triggers.

All index-heavy sectors remained in the red due to sombre mood in the market.

According to M Faizan of Next Capital, the stock market continued to fall amid a bleak economic outlook and absence of positive news to turn direction of the market.

Negative sentiments were fuelled by the statement of outgoing Financial Action Task Force (FATF) President Marshall Billingslea that Pakistan had failed to implement the action plan and there was a possibility of it being placed on the blacklist in October 2019, he added.

Earlier, trading began on a negative note and the market remained bearish throughout the day. The benchmark KSE-100 index was down nearly 500 points by midday, but buying activity towards the end of the session helped it recover partially to close below the 34,200-point mark.

At the end of trading, the benchmark KSE 100-share Index recorded a decrease of 281.33 points, or 0.82%, to settle at 34,190.62.

Arif Habib Limited, in its report, stated the stock market recorded a relatively dull session and continued its downslide. "The market attempted to recover a number of times during the day and the same was noted in the last half hour, which saw recovery of close to 200 points at a point in time," it said.

Selling was recorded in cement, financial, exploration and production (E&P) and automobile sectors. Steel, fertiliser and Sui gas companies remained relatively unscathed.

The cement sector led the volumes, contributing 27 million shares, followed by the power sector having turnover of 23 million.

"K-Electric led the volumes with trading in 21 million shares, followed by Maple Leaf Cement with 10 million shares," the report concluded.

JS Research analyst Maaz Mulla said equities closed on a bearish note with the benchmark KSE-100 index dropping 281 points at 34,190. "The bourse … hit the low of -487 points as pressure was seen in financial, E&P and cement stocks," he said.

Pakistan Petroleum (-1.1%) and Pakistan Oilfields (-1.6%) were the major laggards in the E&P sector as international crude oil prices fell despite imposition of sanctions by the US on Iran after latest escalation in tensions.

Furthermore, Lucky Cement (-1.8%), DG Khan Cement (-1%) and Maple Leaf Cement (-1.3%) remained in the negative territory, adding to market woes. However, in later hours reports came that cement prices had been increased by Rs15-20 per bag in the north.

Cement prices might be increased further by Rs25-30 per bag to pass the impact of federal excise duty on to consumers, as per reports.

Traded value stood at $26 million, up 43% and volumes stood at 145 million shares, up 84%.

"We expect the market to remain volatile due to developments on the economic and political fronts," the analyst added.

Overall, trading volumes increased to 144.9 million shares compared with Monday's tally of 78.8 million. The value of shares traded during the day was Rs4.14 billion.

Shares of 343 companies were traded. At the end of the day, 118 stocks closed higher, 193 declined and 32 remained unchanged.

K-Electric was the volume leader with 21.4 million shares, losing Rs0.04 to close at Rs4.21. It was followed by Maple Leaf Cement with 10.8 million shares, losing Rs0.32 to close at Rs23.81 and TRG Pakistan with 7.7 million shares, losing Rs0.67 to close at Rs16.44.

Foreign institutional investors were net buyers of Rs143.2 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.

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