Stocks plummet 520 points on coronavirus fears

Updated February 27, 2020

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As trading started, the market showed signs of slight recovery, but selling pressure built up in sectors such as the exploration and production.  — AFP/File
As trading started, the market showed signs of slight recovery, but selling pressure built up in sectors such as the exploration and production. — AFP/File

KARACHI: For the fifth consecutive session, stocks fell across the board at the market as the growing scare over the rapid spread of the deadly coronavirus on global equities took its toll on the local bourse.

The KSE-100 index plun­ged another 520 points (1.34 per cent) and closed at 38,338 on Wednesday. Led by the major dent in the economic growth for first quarter in China, the world’s second biggest economy, global markets were reeling under drop in consumer demand and corporate profit warnings.

Risk assets were showing no signs of rebound as repo­rts of continuous s outbreak of virus unleashed wave of panic selling in markets across US, Europe and Asia.

Foreign fund managers were pulling cash out of the South Asian markets and PSX has been witnessing continuous sell-off. Their portfolio outflow in the last one month amounts to $53 million of which stocks worth $14m were sold ove the past week. Foreign profit-booking continued in the sum of $2.54m. Local companies and mutual funds also dumped stocks but the entire selling was absorbed by banks, insurance companies and individuals.

As trading started, the market showed signs of slight recovery, but selling pressure built up in sectors such as the exploration and production; oil and gas marketing companies and banks which weighed heavily on the index that went into a free fall, touching intraday low of 784 points. Long-term investors took the opportunity to buy value scrips at dips which kept the downside in check. The rollover week added further pressure to the market.

The volume increased 19pc to 147.8m shares. Scrips that contributed the most to index slide included Hub Power, down 3.2pc, Engro Corporation 2.6pc, Dawood Hercules 4.9pc, Pakistan State Oil 3.2pc, United Bank 2.2pc, Pakistan Petroleum 1.1pc, Lucky Cement 1.5pc, Oil and Gas Development Company 0.8pc and Fauji Fertiliser Company 0.7pc.

Published in Dawn, February 27th, 2020