KARACHI: The onset of the rollover week saw the KSE-100 index plunge by 359.89 points (1.12 per cent) to close at 31,751.21 on Monday.

The market took off to a positive start, which saw index edge up by 37 points but the benchmark soon caved in to hit intra-day low by 401 points.

On Monday, the sell-off was led by individuals who after several days of buying turned net sellers of $2.76 million worth equity. While the foreigners sold shares of $0.50m, local institutional players and mutual funds remained mainly on the sidelines.

The offloading was across the board as mixed signals were received on the state of the economy. Individuals dumped stocks on renewed fears of hike in inflation in September.

The State Bank of Pakistan Deputy Governor informed the National Assembly’s Standing Committee on Finance that the inflationary pressure will subside after two years. On the positive side, the International Monetary Fund Mission chief affirmed that the inflation expected to decline, the current account was adjusting rapidly and there was significant improvement in tax revenue collections.

However, investors ignored those encouraging words. The heating up of temperature on the political arena and the investors sense of not-too-encouraging outcome of the PM’’s visit to US dampened sentiments.

Volumes declined from 153.3m shares to 86.6m shares (down 44pc day-on-day). Traded value also fell by 34pc to reach $24.8m. Stocks that contributed significantly to the volumes included Maple Leaf Cement Factory (MLCF), Pakistan State Oil (PSO), Fauji Cement Company Ltd, TRG Pakistan and Pak Elektron, which formed 27pc of the total volumes.

Although the international crude prices had stayed put during the weekend, local oil and gas chain showed receding stock prices from exploration and production to oil and marketing companies. Resultantly, Oil and Gas Development Com­pany, Pakistan Petroleum Ltd, Attock Refinery Ltd, National Refinery Ltd, PSO showed significant declines. Banking stocks succumbed to selling pressure while Cement sector pummeled with MLCF, Pioneer and D.G. Khan closing at or near their lower locks.

Published in Dawn, September 24th, 2019