Market watch: Stock market reacts as regional markets stumble

Benchmark KSE-100 index falls 471.96 points.

KARACHI:

The stock market nose-dived as the oil and financial sectors failed to meet investor expectations, amid an environment of capital flight in the region.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index fell 2.01% or 471.96 points to end at 23,015.27 points.

“The session at the bourse kicked off on a negative note. The oil sector remained depressed with mixed volumes throughout the day. Panic was created in the market as international markets saw profit taking.” Said Fahad Ali of JS Global.

“Pakistan Petroleum Limited and Fauji Cement announced their results today where both the companies exceeded the payout expectations but failed to meet the earnings expectations,” said Fahad, adding that the banking sector bore the brunt of the panic spree as investors resorted to selling.



 

“The day kicked off on a dull note with investors anxiously waiting for Pakistan Petroleum’s (PPL PA -3%) full year earnings that came in the latter half of the day and disappointed the market. This below than expected result did bring a short lived spur as the payout was somewhat better, however the excitement didn’t last long and stocks tanked.” Said Faisal Bilwani of Elixir Securities, adding that:

“Fauji Cement (FCCL PA -0.4%) closed marginally negative after a volatile day as this cement maker surprised investors with a Rs1.25 per share cash payout and earnings that quadrupled in the last 12 months.”

Trade volumes rose to a level of 252 million shares compared with Tuesday’s tally of 183 million shares.

Shares of 391 companies were traded on Wednesday. At the end of the day 85 stocks closed higher, 224 declined while 82 remained unchanged. The value of shares traded during the day was Rs10.6 billion.



Fauji Cement was the volume leader with 51.8 million shares losing Rs0.03 to finish at Rs14.68. It was followed by Bank of Punjab with 18.4 million shares losing Rs0.54 to close at Rs12.51 and Lafarge Pakistan with 13.5 million shares losing Rs0.51 to close at Rs8.42.

Foreign institutional investors were net buyers of Rs230 million, according to data maintained by the National Clearing Company of Pakistan Limited.

The nose dive comes at a time when regional markets, most notably India, are struggling to keep investors from fleeing, and before a monetary policy announcement.

Published in The Express Tribune, August 22^nd 2013.

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