KSE index sheds 380 pts as blue chips remain under pressure
KARACHI: The Karachi Stock Exchange (KSE) 100-share recorded further decline as most of the blue chip items closed at their lower circuit levels, brokers said.
The KSE 100-share index lost 380.51 points, or 4.38 percent, to close at 8,314.10 points against the previous session's close of 8,694.61 points.
The market continued its abysmal descent with most blue chips again closing at their lower limits. The management's decision to extend the deadline for settling March future contracts did not have any impact on investors' sentiment.
"The index heavyweights including OGDC, PTCL, PSO and POL all closed at their lower caps early in the morning, thereby disallowing an exit opportunity to investors," said Tanvir Abid, head of research at Live Securities.
Institutional support remained largely absent, as Engro Chemical was the only notable stock in the positive zone, gaining 1.7 percent, he added.
The KSE 100-share index has seen more than 21 percent of its value erased since March 16. The sharp decline of the market in such a short span of time has provided numerous buying opportunities for investors, analysts said.
"The weak holders are at the mercy of the buyers who are now waiting for the fundamental analysis to recommend buy," said Hasnain Asghar Ali, an analyst at Aziz Fidahusein & Co.
Traders said the reporting of an increase in external debts of the country and rising inflationary pressure has created further unrest among punters stuck up with huge quantities particularly in OGDC and other expensive stocks.
Although majority of the stocks stayed under pressure, mild institutional buying in main stocks and short covering in scattered stocks did allow the turnover to increase in comparison with previous session, analysts said.
Technically the constant low volume decline has pushed the next support to 8070 points to 8083 points, said Mr. Ali.
He added that the recent bull-run was fueled by privatization-related developments. "Only an update on the privatization process can invite buyers in the index based stocks," he said.
Turnover increased by 2.80 percent to 140.79 million shares from 136.95 million shares traded in the previous session.
Market capitalization decreased by 4.21 percent to Rs 2.27 trillion from Rs 2.37 trillion at the close of the previous session. The shares of 292 companies closed after losses, 55 suffered losses and 17 stayed unchanged.
Pakistan Telecommunication Company Limited was the main volume leader with 22.28 million shares changing hands. It closed at Rs 72.00, down Rs 3.75 from Rs 75.75 of the last trading session. Pak PTA Limited remained the second in volume with trading of 18.42 million shares. It closed at Rs 12.50 from Rs 13.20, after a loss of 70 paisas. Dera Ghazi Khan Cement closed at Rs 60.50 from Rs 63.65 falling Rs 3.15. Fauji Fertilizer Bin Qasim closed at Rs 30.10 after losing Rs 1.55 from Rs 31.65. Hub Power Company closed at Rs 29.00 after shedding five paisas from Rs 29.05.
Futures market: Trading at the futures counter declined to 81.94 million contracts from 97.62 million contracts traded in the previous session. Fifty-two contracts closed after losses while five recorded gains.
The March contract of PTCL was the volume leader with 16.91 million shares changing hands. It closed the session at Rs 72.89, down Rs 3.83 from Rs 76.72.
The March contract of PSO was the second in volume, trading 14.41 million shares at Rs 401.85 after declining Rs 21.14 from Rs 422.99. The March contract of SNGP traded 4.51 million shares to close at Rs 60.68 from Rs 63.87, down Rs 3.19. The April contract of PTCL traded 4.26 million shares to close at Rs 72.89 from Rs 76.72 after rising 17 paisas. The March contract of Lucky Cement closed at Rs 46.05 from Rs 48.45 after gaining Rs 2.40.