KARACHI: Stocks dropped on Thursday as investors decided to book profit, partly to sell off overvalued stocks and in part due to futures rollover week. The benchmark KSE-100 index shed 346 points, or 0.69 per cent, to close at 49,481.70.

While foreign investors sold shares worth $3.41 million, mutual funds — the leading buyers in the recent rally — trimmed their positions by $0.62m.

The market started out on a positive footing on Thursday, but after rising by 82 points during the day it took a turn and dipped in the red to an intraday low of 49,446 points. It then finished near the day’s lowest point, indicating overall bearish sentiment.

The volume of shares traded during the day increased by 24pc to 399m shares while the traded value receded by 12pc to Rs14.8 billion. Volumes were led mainly by small-cap stocks.

Many market participants took the stocks’ decline in stride. “After having rallied more than 4,000 points following the developments surrounding the Panama Papers case, the KSE-100 index has simply lost steam and is undergoing a mini-consolidation,” analysts at Intermarket Securities said. A breather at these

levels only rationalises the reason for bulls to keep marching on.

Pakistan Tobacco rose 4.9pc, Pak Suzuki 5pc, Hum Network 8.1pc and EFU General 3.5pc, contributing 65 points to the index in aggregate, dealers at Topline Securities said. In contrast, Habib Bank’s share fell 1.6pc, Nestle Pakistan 4.1pc, Pakistan Petroleum 1.8pc and Searle Company Ltd 2.4pc, taking away 159 points off the index.

Ahsan Mehanti of Arif Habib Corporation said the stocks closed lower amid pressure exerted by institutional profit-taking after earnings announcements by major companies.

Published in Dawn, April 28th, 2017