Panic settled in as the stock market took a drastic 285 point or 2.33% drop on Wednesday to close at a two-and-a-half month low of 11,941.72 points.
Due to an ever-worsening law and order situation and weak international markets, investors refused to take advantage of the valuations, said Elixir Securities equity dealer Faisal Bilwani.
Oil companies made up a significant chunk of the selling with Oil and Gas Development Company alone bringing the market down by 119 points after falling by Rs6.74, said Topline Securities equity dealer Samar Iqbal.
Oil and gas was not the only sector that witnessed selling. Only 32 companies saw their shares rise while 208 companies declined and 73 remained unchanged.
The sell-off was mainly witnessed in the high-priced stocks, unable to sustain high valuations due to curtailed local strength and absence of follow-up support, said Aziz Fidahusein and Company Research Head Hasnain Asghar Ali.
Trade volumes rose to 46 million shares compared with yesterday’s 15 million. The total value of trade on Wednesday was worth Rs2 billion.
On a day that all the companies on the trade volume charts witnessed profit taking, Jahangir Siddiqui and Company led the way with 3.2 million shares at Rs6.71 after a decline of Rs0.02. Lotte Pakistan was second with 2.78 million shares traded at Rs11.76 after a decline of Rs0.35. National Bank (NBP) was another big company to have its shares decline substantially. NBP was the third in trade volume with 2.4 million shares traded at Rs50.89 after a decline of Rs2.56.
Foreign institutional investors were gross buyers of Rs113.6 million and gross sellers of Rs66.3 million worth of shares during the trade session, according to data compiled by National Clearing Company of Pakistan Limited.
Published in The Express Tribune, August 4th, 2011.