Market watch: Politics back in play as market loses ground

Bourse loses gains made earlier in the week.

KARACHI: Stocks took a sound beating on Thursday on resurgent fears of political turmoil, and the stock market saw most gains made earlier in the week wiped out as investors abandoned positions to retreat to safer grounds.

“Local political issues affected equity values at the local bourse, which fell by more than 1% with low volumes,” said Topline Securities’ equity dealer Samar Iqbal. “Investors were not certain about the outcomes of announcements [made] by political parties.”

The Karachi Stock Exchange’s (KSE) benchmark 100-share index plunged 1.27% or 212.30 points to end at the 16,529.92 points level. Trade volumes were lower at 89 million shares, compared with Wednesday’s tally of 91 million shares. The value of shares traded during the day was Rs2.68 billion.

“Equities wiped off early week’s gains, as politics reined in the bulls and pushed for a correction,” said Elixir Securities’ analyst Sibtain Mustafa.

Shares of 346 companies were traded on Thursday. At the end of the day, 70 stocks closed higher, 224 declined, while 52 remained unchanged.

“MCB Bank had a rough rollercoaster day, trading over a million shares on talks of foreigners’ selling. Other leading blue-chips, namely the Oil and Gas Development Company, Pakistan Petroleum, and Pakistan State Oil surrendered past gains to mirror the broader market,” reported Mustafa. “Pakistan Telecommunication Company (PTCL) managed a strong open, but failed to carry its momentum near close down, as talks of lower-than-average billed minutes for the said month paved way for stock correction. Overall, volumes picked up in the later half, as institutions cherry-picked dividend-yielding stocks, namely Hub Power Company, Nishat Chunian Power and Pakistan Oilfields near market close.”

Pakistan Telecommunication Company was the volume leader with 12.16 million shares losing Rs0.52 to finish at Rs16.39. It was followed by Fauji Cement with 10.85 million shares gaining Rs0.07 to close at Rs6.46 and Maple Leaf Cement with 5.20 million shares losing Rs0.45 to close at Rs15.31.

Foreign institutional investors were net sellers of Rs360.76 million, according to data maintained by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, January 11^th, 2013.

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