RECORDER REPORT
KARACHI: The sentiment-driven Karachi bourse tumbled Monday by 2.14 percent as politico-economic negatives triggered panic selling on the already depressed market.
The KSE-100 closed at what analysts said the two-month low of 32,255.20 points.
Having surged to session’s high of 32,995 points in the morning, the benchmark index nosedived to shed 7.5 points primarily because of what analysts believe reports the Economic Coordination Committee (ECC) of the Cabinet was likely to approve the government’s Rs 40 billion tax proposals.
Then reports that former petroleum minister Dr Asim Hussain had confessed to have been treating “terrorists” at Dr Ziauddin Hospital are said to have added fuel to the fire.
The KSE in recent days has been bearish on the back of negatives such as lack of triggers, continued foreign selling and reportedly likely action of the NAB and SECP against certain stock brokers.
Monday, the week’s first trading session, saw the bloodbath as what Ahsan Mehanti of Arif Habib Corp said: “Panic selling was witnessed at KSE ahead of ECC approval for additional tax measures of Rs40bn likely to hit corporate earnings outlook.”
Political uncertainty, foreign selling, global commodities turmoil, record low banking spreads and renewed concerns for over Rs600bn circular debt in the energy sector, the analyst cited as catalysts for the day’s bearish close.
Mohammad Sohail, chief executive at Topline Securities, attributed the major fall to “continuous foreign selling” that, he said, triggered panic on the market. “Dr Asim Hussain’s… ‘confession’ to terrorism and corruption related accusations also affected the sentiment,” the analyst viewed.
Monday’s was the ninth consecutive session of negative closing at the Karachi bourse in which the index lost 5.3 percent, taking the November’s fall to six percent.
Foreign investors ended the day with $ 8.169 million net selling. This took the size of foreign portfolio investment outflows during outgoing month of November to $ 53.06 million.
Sohail said the day’s “above average” selling occurred as “foreigners offloaded their positions in Pakistan due to global economic uncertainty.”
Trading turnover rose to 143 million shares from 122 million of Friday last week. The traded value also moved northward to accumulate to Rs 6.98 billion compared to Rs 6.26 billion of the last session. Of the 345 scrips that changed hands, only 46 settled in the green in terms of valuation. Majority, 289, lost their worth and that of 10 remained unchanged. The market cap slid to Rs 6.86 trillion.
K-Electric led volumes with 13 million shares, each traded at close at Rs 7.20. To follow were TRG Pakistan 9.3 million, Silk Bank 7.4 million, Pak Elektron 6.4 million, JSCL 4.9 million, Pace Pakistan 4.9 million, SSGC 4.8 million, SNGPL 4.6 million, Bank of Punjab 4.2 million and Byco Petroleum 3.8 million shares. Over 21.8 million contracts were traded on the futures market against 77.29 million of Friday.
“The volume chart is once again dominated by some small-cap stocks,” observed Topline analyst Mohammad Rizwan.
