KARACHI: The two-day winning streak at the stock market snapped on Tuesday with the KSE-100 index declining by 201.31 points (0.47 per cent) to close at 42,544.47.

Lack of positive triggers and prevailing economic uncertainty due to absence of any concrete road map to deal with the country’s precarious economic situation kept investors on the back foot.

The index made intraday high by 98 points, but heavy sell-off triggered in the steel sector had a domino effect across all sectors that included fertiliser, cement, banks and tobacco, which dragged down the index. Profit taking was prominent in the last two hours which saw the index sink by 229 points due to rollover of future contracts.

Analysts at Arif Habib Ltd stated the news that prompted the sell-off in steel sector was possibly related to the revival of Pakistan Steel Mills. Fertiliser sector saw demand in Fauji Fertiliser Bin Qasim, which also reacted on the expectation of restructuring of gas pricing mechanism and removal of The Gas Infrastructure Development Cess Act, 2015.

Volume for the day declined from 217.6 million shares to 183.4m shares while the average traded value also decreased by 15pc to Rs7.7 billion. Agrtiech Ltd, Siddiqsons Tin, Nimir Resin, Engro Polymer and Chemicals and Fauji Fertiliser were the leaders, accounting for 30pc of the total turnover.

Foreign investors sold shares worth $1.87m, which were mostly absorbed by the mutual funds that took fresh positions in stocks worth $1.73m. Sectors contributing to the day’s dismal performance included fertilizer, decreasing by 39 points, cement 38 points, tobacco 28 points, technology 15 points and engineering/steel 15 points.

Major contribution to the index downside came from Dawood Hercules, down 4.73pc, Pakistan Tobacco 4.86pc, Mari Petroleum 1.89pc, Lucky Cement 0.70pc and National Bank of Pakistan 1.90pc, taking away 84 points. On the flip side, Pakistan Oilfields, up 1.3pc, MCB 0.83pc and Fauji Fertiliser Bin Qasim 3.57pc added 44 points.

Moving forward, analysts said they expected the market to remain volatile and choppy with flows from local and foreign institutions directing the market.

Published in Dawn, August 29th, 2018