KSE index declines due to political unrest

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KARACHI: The Karachi Stock Exchange’s (KSE) benchmark 100-index declined by a massive 146.19 points on Monday to 16,502.65 points amid political unrest in the country, said dealers.

Samar Iqbal, equity dealer at Topline Securities (Pvt) Ltd, said that political uncertainty caused investors to trim their positions at the local bourses. “Volumes also remained on the lower side as investors feel to re-enter the market once the dust settles down on the political front. Small capped stocks remained in the limelight once again,” she said.

 

The index fell by 146.19 points or 0.88 percent to 16,502.65 points against 16,648.84 points recorded in the last session. The index increased by a few points to 16,651.19 points during the intraday session, but remained low most of the time and the low level of the day was recorded at 16,420.35 points. Meanwhile, the KSE-30 index declined by 105.96 points or 0.78 percent to 13,483.71 points in the session.

 

Along with the index, the turnover and value also declined but witnessed a minor change in the market. Turnover fell by four million shares to 95.84 million shares from 99.58 million shares, whereas the value declined to Rs2.40 billion against Rs2.48 billion recorded in the last session.

Hasnain Asghar Ali, COO of Escorts Capital, said that political uncertainty linked to the high- profile judicial hearing and its likely repercussions kept the market participants on the backfoot, thus leaving the equity market to lose numbers. This kept instances of low volume price erosion a regular happening, although mild value buying in selective stocks relieved the benchmark from an unprecedented decline.

 

In addition, the prevailing threat of run-down on foreign currency reserves kept the liquid participants least bothered to capitalise on the opportunities.

 

“The news of unconditional apology that came in towards the closing hour did invite across the board short covering, thus allowing the index to stage a comeback and close above 16,500 points,” he said.

 

Ahsan Mehanti, analyst at Arif Habib Corp, said that the stocks closed bearish on speculations over the political setup in the country after the political leaders call on long march for a caretaker setup ahead of elections.

 

The country’s security unrest affected the sentiments. “Weak global stocks and commodities and concerns for rising circular debt in energy sector played a catalyst role in the bearish activity at the KSE, despite strong earnings outlook,” he said.

 

Shakir Padela, analyst at JS Research, said that the index started off in the negative zone primarily on the back of the ongoing political uncertainty in the country. “After experiencing an intraday low of 1.3 percent, the index managed to recover slightly after the dismissal of the contempt of court case against Altaf Hussain and the index ended the day down by 0.9 percent,” he said.

 

As investors chose to remain on the sidelines, major activity was witnessed in second and third- tier stocks with JSCL, being the volume leader with 11.9 million shares traded, he said.

 

The highest increase was recorded in the shares of Pak Int Cont SD, which increased by Rs10.51 to Rs220.81 per share, followed by Al-Ghazi Tractors, which rose by Rs4.86 to Rs234.99 per share. A major decline was noted in the shares of Unilever Pak, which declined by Rs225.01 to Rs9,974.99 per share, followed by Wyeth Pak Limited that declined by Rs45.00 to Rs910.00 per share.

 

Stocks that recorded significant turnover included Jahangir Siddiqui Co, Byco Petroleum, Maple Leaf Cement, Fauji Cement and Azgard Nine. Jahangir Siddiqui Co was the volume leader with 11.92 million shares, with a decline of 46 paisas to Rs14.88 per share; followed by Byco Petroleum with 8.65 million shares and a decline of 32 paisas to Rs13.47 per share.

 

Shares’ turnover in the futures market increased to 5.85 million shares from 4.67 million shares traded in the previous session. Of a total of 322 companies’ stocks traded, 50 advanced, 256 declined and 16 remained unchanged.

 

Courtesy:  The News


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