Market watch: Stocks close in the red amid seesawing sentiments

Benchmark KSE-100 index drops 61 points.

KARACHI: The fog of uncertainty continued to hang heavy in the stock market on Wednesday: sentiments fluctuated with investor concerns, especially on continued foreign selling in domestic stocks. Furthermore, declines in global prices led to rumoured institutional selling in heavily-weighted oil stocks.

“Lower global commodities, limited foreign interest and renewed concerns for allegations on the judiciary played a catalyst role in bearish sentiments at the stock exchange,” said Arif Habib Corp Director Ahsan Mehanti

The Karachi Stock Exchange’s (KSE) benchmark 100-share index shed 0.45% or 60.67 points to end at the 13,368.89 points level. Trade volumes improved slightly to nearly 78 million shares compared with Tuesday’s tally of 71 million shares. The value of shares traded during the day was Rs3.45 billion.

“Stocks closed lower amid thin volumes on concerns for the security situation in the city,” stated Mehanti. However: “Institutional support was witnessed in the early session on hopes for an improvement in Pakitsan-US ties, after the US agreed to send Nato negotiators ... to Pakistan.”

“Engro ... remained under pressure as investors believe that June results will not be in line with earlier expectations. Aggressive selling was seen in the Oil and Gas Development Company (OGDC), Pakistan State Oil (PSO) and Pakistan Oilfields (POL) that affected the benchmark index,” reported Topline Securities equity dealer Samar Iqbal.

“OGDC closed at Rs147.63 [from Rs150.10], POL at Rs351.79 [from Rs354.02] and PSO slid down to Rs235.29 [from 239.87]... In the cement sector, an [increase] in dispatches caused DG Khan Cement to close at Rs39.75 [from Rs39.43]. Investors interest was witnessed in the Hub Power Company with volumes of 4.7 million shares as the scrip rallied on the acquisition deal,” informed JS Global analyst Mujtaba Barakzai.

Engro was the volume leader for the day, with 10.03 million shares losing Rs4.99 to finish at Rs102.13. It was followed by Bank Alfalah with 6.08 million shares gaining Rs0.28 to close at Rs16.40 and Pakistan Telecommunication Company with 5.93 million shares losing Rs0.05 to close at Rs13.84.  Foreign institutional investors net sellers of Rs71.24 million, according to  National Clearing Company of Pakistan Limited.

Published in The Express Tribune, June 14^th, 2012.