Stocks shed 232 points on FATF decision

Updated February 22, 2020

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The market opened positive but soon succumbed to selling pressure. — AFP/File
The market opened positive but soon succumbed to selling pressure. — AFP/File

KARACHI: Shares at the stock market continued to tumble on Friday where the KSE-100 index plunged by 232 points (0.57 per cent) and settled at 40,249.

The market opened positive but soon succumbed to selling pressure. The fall in the first half was gradual as the index largely traded sideways but profit-taking intensified in the second session after receiving a couple of corporate results that posted lower-than-expected earnings.

Interest was centered on the official version of the Financial Action Task Force’s plenary session and the market kept waiting for a statement till the close of trading time. Many thought that the reports of deferring the decision to another review in October was not good enough.

Investors remained disinterested despite some positive developments such as the assurance by SBP Governor Dr Reza Baqir that the worst phase of economic stabilisation was over. Moreover, the comfort on the ease in inflation following the Prime Minister’s direction to keep the gas and electricity prices unchanged till June also failed to prod the equity investing public into buying action.

Traders said the statement released by the FATF after closing hours, while admitting that Pakistan had largely addressed the 14 of 27 items and urged the country to complete action plan by June may be received warmly by the market on Monday.

Foreigners sold equity worth $1.60 million and a consistent outflow also was a cause of concern for investors. Insurance companies again mopped up the liquidity buying shares valued at $1.84m.

Sector-wise, fertiliser declined 92 points, banks 64 points, exploration and production 49 points, investment banks 35 points while power gained 24 points and cement 21 points.

Stocks that saw major fall included Engro Corporation, down 2.82pc, MCB 2.31pc, Dawood Hercules 3.17pc, Oil and Gas Development Company 1.65pc, Habib Bank 0.89pc, Fauji Fertiliser 0.94pc and Engro Fertiliser 1.28pc which cumulatively contributed 225 points towards the index drawdown.

Published in Dawn, February 22nd, 2020