Stocks plummet 468 points on foreign selling

Published October 28, 2020
Stocks tumbled on Tuesday with the KSE-100 index taking a plunge of 468.64 points (1.12 per cent) to close at 41,381.83. — File
Stocks tumbled on Tuesday with the KSE-100 index taking a plunge of 468.64 points (1.12 per cent) to close at 41,381.83. — File

KARACHI: Stocks tumbled on Tuesday with the KSE-100 index taking a plunge of 468.64 points (1.12 per cent) to close at 41,381.83.

The index ceded over 80pc of the splendid gains made a day earlier. With the momentum generated from the Monday’s closing near the day’s high, the index opened in the positive but only managed to gain 72 points before selling erupted which went to exacerbate as the day progressed.

The index succumbed to selling pressure mainly by the foreigners amounting to $5.96 million. In the first two days of this week, overseas investors, mainly foreign corporates, have dumped Pakistani equity worth $11.77m.

Among local participants, save for the insurance companies and brokers, the rest picked up shares at dips. The benchmark index hit the intra-day low by 523 points before clawing up a little.

Traders and analysts said that the foreign selling was not Pakistan specific but spilled over into the local market from the meltdown in global stock and commodity markets.

International oil prices also remained subdued taking the exploration & production stocks down under. Other hazards that sent investors scurrying to safety of risk-free avenues included the deteriorating political situation in the country.

The bomb blast in Peshawar and the rising figure of Covid-19 cases which was feared to lead to more lock downs and the two sessions remaining in the roll-over week, all went to dampen investor sentiments.

The hike in gas tariff was thought to put off industrial expansion while the rupee recovery failed to impress stockholders.

To create a bleaker environment for investors, the Pakistan State Oil (PSO) unveiled results which were thought to be lower than expected though several other companies and banks recorded sizeable growth in earnings.

Cement sector remained the investors’ favorite where several big ticket stocks defied the intense bearish trend.

The volume declined slightly from 486m shares to 481m shares. The traded value, however, dipped 14pc to $114.5m.

Habib Bank Ltd, down 60 points, Bank Al Habib Ltd 46 points, PSO 33 points, TRG Pakistan 28 points and Oil and Gas Development Company 22 points were major laggards.

Published in Dawn, October 28th, 2020

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