Stocks take a new year’s beating

Index down by 305 points on panic selling.

KARACHI: The selling spree, referred pejoratively to as the ‘New Year’s Sale’ by local punters, continued on the second day of 2013 with the market closing deep in the red territory as investors dumped stocks en masse due to prevailing political and social tensions.

“Panic-selling was witnessed at the stock exchange in stocks across the board,” said Arif Habib Corp analyst Ahsan Mehanti. However, indices recovered after a record fall in the early hours of trading, on hopes that the president and prime minister will achieve something positive from their meeting with Tahirul Qadri, the man behind the recent spell of political uncertainty in the country, said Mehanti.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index plummeted 1.82% or 304.88 points to end at the 16,489.99 points level. Shares of 371 companies were traded on Wednesday. At the end of the day, only 31 stocks managed to close higher, while 325 saw their prices decline, while 15 remained unchanged.

“After a positive to neutral opening, the index […] hit a low of 16,379 points and broke all technical support barriers, as individual and institutional investors chose to book profits and liquidate their positions,” reported Fahad Ali, analyst at JS Global.

Trade volumes surged to 241 million shares, compared with Tuesday’s tally of 120 million shares. The total value of shares that changed hands during the day was Rs5.56 billion.

“The broader market witnessed much better volumes on institutional activity; however, no blue-chip made it to the top of the volume leaders chart,” said Elixir Securities’ Jawwad Aboobakar. “Reduction in the National Savings Scheme rates attracted interest in yield plays on lower levels, with Hub Power, Fauji Fertilizer, Kot Addu Power and Nishat Chunian Power all recovering from their day’s low on high volumes.”

Jahangir Siddiqui and Company was the volume leader with 15.31 million shares losing Rs0.81 to finish at Rs14.77. It was followed by Byco Petroleum with 13.90 million shares losing Rs1.00 to close at Rs13.10 and Pakistan International Airlines with 13.78 million shares losing Rs0.60 to close at Rs3.82.

Foreign institutional investors were net sellers of Rs234.24 million, according to data maintained by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, January 3^rd, 2013.                

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