RECORDER REVIEW
KARACHI: Bears dominated the Karachi stocks market throughout the week amid continued foreign selling.
The benchmark KSE-100 index ended the week 2.6 percent down at 32,960 points.
This 896-point loss, analysts said, marked the eight-week low. “Foreign selling, futures roll-over and lack of trigger in the market dragged the local bourse,” opined Topline analysts. Hamza Kamal at Shajar Research said the bears won the battle against the bulls during the week.
“The week was expected to be volatile due to the settlement of outstanding positions in futures trade,” he said.
As the country’s largest bourse witnessed a declining trend during entire week, the trading turnover averaged on 143 million shares, registering 18 percent fall over preceding week.
The market continued to trade in a tight range as the decision by the State Bank to keep the policy rate unchanged was highly in line with market expectations, said Kamal.
The banking scrips reacted contrary to expectations of bull-run declined by 2.38 percent Week-on-Week as the central bank’s decision brought an end to a cycle of rate cuts which, the analyst said, had led to an attrition of banking interest rate spreads.
The prices of stocks trade, however, showed one percent appreciation to stand on per day average basis at Rs 6.6 billion or $63 million.
Foreign investors kept offloading their positions which concluded the week in red at $ 13 million, on net basis. This took month-to-date selling at Karachi Sock Exchange to $44.9 million. Major selling was seen in banking and chemical sectors which saw outflows, respectively, of $6 million and $5.7 million.
Mohammad Sohail, chief executive of Topline Securities, attributed the increased flight of portfolio investment to a general trend in “all countries”.
International stocks and commodities, especially WHI crude oil, have been volatile ever since China, the world’s second largest economy, has started to take some economic reforms, specially at the country’s bourses. Sector-wise share trade at KSE witnessed the support services having grown by 16.5 percent over the week followed by multi-utilities, leisure goods, health care equipment and services and beverages rose by 3-3.4 percent.
On the flip side, engineering, technology and hardware equipment, forestry and household goods declined by 7.9, 6.1, 6 and 4.8 percent. The oil and gas sector continued to bleed and slid by 2.09 percent vis-a-vis the route of global oil prices as index heavyweights OGDC, minus 2.79 percent, and POL, down 2.99 percent, led the decline.
The SSGC, on the other hand, gained 9.94 on speculation that the gas utility would soon announce its long-awaited results.
The cement sector declined 2.68 percent. “We... foresee market to remain range bound,” said Shajar analyst.
