Market watch: KSE-100 falls 273 points owing to global sell-off

KARACHI: Following a day’s respite, the stock market recorded losses once again on Friday as the KSE-100 index fell 273 points owing to global equity sell-off amid concern over world growth and dismal financial results.

Major stock markets around the world tumbled during the day after the World Health Organisation (WHO) called coronavirus outbreak a global emergency.

Earlier, trading began on a positive note, however, the index was unable to sustain the gains owing to weak investor sentiment caused by the absence of positive triggers to provide direction to the market.

The first trading session ended with a loss of mere seven points. In the second session, trading began negatively and the index fell steadily till the end. A selling spree, towards the end of the session, extended the losses.

At close, the benchmark KSE-100 index recorded a decrease of 272.57 points, or 0.65%, to settle at 41,630.93.

Arif Habib Limited, in its report, stated that the market traded in a range of +234 points and -345 points and closed the session down by 273 points.

“Despite a slight recovery in international crude oil prices, the oil and gas chain remained subdued with the exploration and production stocks declining further by approximately 2% on average,” he said. “Similarly, PSO faced selling pressure.”

Fertiliser companies – Engro Fertilisers and Fauji Fertiliser – were said to have announced a reduction in urea prices by Rs150 and Rs300 per bag respectively and it sparked selling in the fertiliser stocks.

The technology sector recorded a trading volume of 33.3 million shares, followed by oil and gas marketing companies (27.6 million) and vanaspati manufacturers (24 million).

Among individual stocks, Unity Foods led the volume table with trading in 24 million shares, followed by Hascol (23.5 million) and TRG Pakistan (12.4 million), the report added.

JS Global analyst Maaz Mulla said the first half of the trading session belonged to the green zone as the index touched an intra-day high of +234 points.

However, selling pressure was witnessed in the second half and the index hit an intra-day low of -345 points to close at 41,631, down 273 points. “This divergent trend can be attributed to the last day of the rollover week,” he said.

Volumes increased by 19% day-on-day to 194 million shares. Unity Foods (+1%), Hascol (+4.5%) and TRG Pakistan (+0.4%) were the volume leaders, with cumulative trading in 72 million shares.

Major contribution to the index came from Systems Limited (+5.5%), Hascol (+4.5%), Hubco (-0.1%), Pakistan Petroleum (-1.8%), Lucky Cement (-2.2%), UBL (-1.7%) and Bank Alfalah (-2.8%).

Selling pressure was witnessed in the cement and banking sectors where DG Khan Cement (-2.3%), Lucky Cement (-2.2%), Maple Leaf Cement (-2.3%), Pioneer Cement (-2%), HBL (-1%), UBL (-1.7%), MCB (-1.1%) and Bank Alfalah (-2.8%) were the major losers.

“Moving forward, we recommend investors to stay cautious and accumulate value plays mainly in banking, textile and exploration and production stocks on further dips,” the analyst said.

Overall, trading volumes increased to 193.9 million shares compared with Thursday’s tally of 162.2 million. The value of shares traded during the day was Rs7.9 billion.

Shares of 346 companies were traded. At the end of the day, 123 stocks closed higher, 211 declined and 12 remained unchanged.

Unity Foods was the volume leader with 24 million shares, gaining Rs0.14 to close at Rs13.98. It was followed by Hascol Petroleum with 23.6 million shares, gaining Rs1.11 to close at Rs25.72 and TRG Pakistan with 12.4 million shares, gaining Rs0.12 to close at Rs26.99.

Foreign institutional investors were net sellers of Rs264.6 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.