Market watch: KSE-100 plunges 825 points as rollover week begins

Benchmark index decreases 2.02% to settle at 40,008.29

KARACHI: The stock market gave in to the bearish pressure on Monday as the KSE-100 index nosedived 825 points owing to weak cues coupled with the internal and external headwinds faced by Pakistan in recent days.

Moreover, weak position of the government in defending former president and chief of army staff Pervez Musharraf in a high treason case, where he was awarded the death penalty by a special court last week, took its toll on investor sentiment and triggered selling pressure.

Analysts predicted massive selloff in the ongoing week, citing it was a rollover week during which investors would offload stocks purchased earlier at attractive valuations.

Earlier, trading began on a pessimistic note and the KSE-100 index fell due to bearish investor sentiment. The index managed to erase some of the losses after midday but could not sustain the rise.

The downward trend turned steeper towards the end of the session. Nevertheless, the bourse managed to sustain the 40,000-point mark.

At close, the benchmark KSE 100-share Index recorded a decrease of 824.7 points, or 2.02%, to settle at 40,008.29.

A report of Arif Habib Limited stated that the market was facing internal and external headwinds these days. "Towards the close, the index's decline crossed 900 points as selling pressure built up throughout the day," it said. "The market closed down 825 points with a decline in 274 stocks."

Selling was noted across the board, but was particularly seen in the oil and gas chain. Pakistan Petroleum's most anticipated hydrocarbon discovery proved to be minuscule that failed to lift investor sentiment. Resultantly, PPL traded near its lower circuit by the end of the session.

The cement sector led the volumes with trading in 26.6 million shares, followed by the technology sector (23.1 million) and oil and gas marketing companies (22.7 million).

Among individual stocks, WorldCall Telecom traded the most with 13.6 million shares changing hands, followed by Hascol (R) (12.7 million) and Unity Foods (11.9 million), the report added.

Topline Securities stated in its report that the KSE-100 index recorded a massive decline of 2.02% or 825 points as the index barely managed to maintain the 40,000 level. "Equities remained under pressure as the rollover week has started," it said.

JS Global analyst Danish Ladhani said the market remained lacklustre throughout the trading session after a hectic sell-off.

"Moreover on the political front, Indian and Pakistani troops exchanged fire in some areas along the Line of Control (LoC) in the disputed Himalayan region of Kashmir adding more turbulence to the index movement."

Negative sentiment was observed across the board as out of the 342 traded stocks, 289 declined, 41 went up and the rest remained unchanged.

Top decliners of the KSE-100 index were HBL (-93 points), followed by PPL (-91 points), Hubco (-54 points) and Dawood Hercules (-51 points), the report added.

Overall, trading volumes dropped to 179.1 million shares compared with Friday's tally of 180.7 million. The value of shares traded during the day was Rs7 billion.

Shares of 342 companies were traded. At the end of the day, 41 stocks closed higher, 289 declined and 12 remained unchanged.

WorldCall Telecom was the volume leader with 13.6 million shares, losing Rs0.07 to close at Rs1.21. It was followed by Hascol (R) with 12.7 million shares, losing Re1 to close at Rs9.54 and Unity Foods with 11.9 million shares, losing Rs0.82 to close at Rs13.97.

Foreign institutional investors were net buyers of Rs163.9 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.