KARACHI: The stock market remained in a state of flux for much of the outgoing week as investors awaited the verdict on the Panama Papers case.

The KSE-100 index plunged 432 points, or 0.87 per cent, to close at 49,191.

Investors also stayed on the sidelines as they waited for the market to take a bigger dip before building fresh positions. The apex regulator’s measures to improve transparency and curb manipulation also kept market participants on their toes.

The ongoing consultations to resolve leverage issues did not reach a conclusion while small leveraged investors went into distress sale as the regulator-broker tussle over ‘in-house’ badla choked financial lines.

The sudden drop in oil prices mid-week — Brent down 6.7pc on a weekly basis — took its toll on the index heavyweight oil and gas sector.

On the positive side, the PSX released sale proceeds of 40pc shares, which can lead to improved liquidity of brokerage houses.

Foreigners were net buyers of $15.4 million worth of stocks during the week. They were net sellers of $32.7m during the previous week. Foreign corporate entities remained the biggest accumulators of equity worth $13.55m. Buying of $8.6m was seen in the oil and gas exploration sector while the foreign portfolio outflow from banking and power sectors amounted to $1.3m.

Among local participants, individuals remained major sellers by offloading stocks worth $23.58m. Mutual funds and companies absorbed $8.64m and $4.34m, respectively.

The average daily volume dropped 21.1pc and the average daily traded value declined 20.3pc over the preceding week.

Sectors that took a beating during the week included exploration and production, which declined 3.9pc with OGDC, PPL, Mari and POL dipping by 4.3pc, 3pc, 5.2pc and 2.5pc, respectively, wiping out 190 points from the index.

Other laggards included technology and refinery sectors that dragged the index down by 48 and 44 points, respectively.

On the flip side, life insurance and chemical sectors performed well.

Other stocks that contributed most to the downside during the week included TRG 7.92pc, PSO 3.66pc, Lotte Chemical 10.4pc, Engro Polymer and Chemicals 10.2pc, Nishat Chunian 5.5pc, Fatima Fertiliser 5pc and Pak Suzuki 4.7pc.

Performance leaders during the week were FFBL 5.2pc, Habib Metro Bank 3.7pc, Shell 3.5pc, MCB 2.7pc and ICI 2.7pc.

The news flow during the week included Hascol planning to expand operations in Balochistan, reports about the Lahore High Court relisting the case against anti-dumping on steel for March 17, IPPs threatening to invoke sovereign guarantees, banking sector’s NPLs declining to an eight-year low, cement sales for February declining 0.41pc, SSGC and Engro reaching a deal for the re-gasification of 600 million cubic feet per day of LNG, assets in Islamic banking jumping to Rs1.6 trillion, and PTC and China Telecom Global signing a memorandum of understanding to establish an optical fibre network.

Outlook: Investors’ sentiments are likely to remain clouded until some clarity emerges on the Panama Papers case. With the results season also drawing to a close, volumes can be tepid going forward.

Most market pundits, therefore, conclude that trading may remain range-bound in the week ahead in the absence of major triggers.

Published in Dawn, March 12th, 2017