Stocks end negative, volumes remain low

Investors stayed on the sidelines as uncertainty loomed over the extent of damages caused by the flood.

KARACHI: The Karachi Stock Exchange (KSE) lost 48.23 points during trade on the first day of the week. Investors stayed on the sidelines as uncertainty loomed not just over the extent of damages caused by the flood but also the outcome of the Pakistani delegation’s meeting with the International Monetary Fund (IMF).

“Very limited local and foreign activity was witnessed as the market awaits an outcome of the key IMF meeting,” wrote Nazim Abdul Muttalib from Elixir Securities.

The benchmark KSE 100-share index lost half a percentage point to close at 9,812.10 points. Only 50.8 million shares were traded during the day.

“The finance minister suggesting that Pakistan could get $6 billion in flood aid provided early positive impetus, but the market failed to sustain the momentum,” according to Ahmed Rauf from JS Global Capital.

Shares of 340 companies were traded on Monday. At the end of the day, 141 stocks closed higher while 181 declined and 18 remained unchanged. The value of the shares traded during the day was Rs1.15 billion.

With a trade volume of 19.94 million shares, Silkbank Limited emerged as the market leader. The bank’s stock went up by Rs0.23 to close at Rs2.88 per share.

“Volumes remained dry while Silkbank recorded about 38 per cent of the total traded volume on the back of aggressive buying followed by LOTPTA,” commented Samar Iqbal, an equity dealer from Topline Securities.

Meanwhile, Rauf was of the view that the scrip gained about 8.7 per cent on the back of a better-than-expected result in the first half of this year.

Lotte Pakistan PTA followed with 4.68 million shares traded on Monday. The scrip ended about 0.9 per cent lower at Rs8.03 per share. “It seems that the scrip fell due to speculations because on a fundamental basis it seems to be going strong,” commented Khurram Schehzad, Head of the Financial and Economic Research Department of Invest Capital Investment Bank.

Arif Habib Securities was the third market leader with a trade of approximately two million shares.

“The outcome of the IMF meeting will be detrimental for the market,” concluded Schehzad.

Published in The Express Tribune, August 24^th, 2010.