KARACHI: The stock market was overwhelmed by the continuous rise in new infection cases of Covid-19, which stayed in precarious double digits, fuelling fear and uncertainty over the possibility of lockdowns.

Investors preferred to stay clear of the stocks represented by the persistent drop in traded volume which on Thursday shrank to 314m shares of the traded value of Rs17bn. The KSE-100 index tumbled 159.75 points, or 0.36 per cent, to close at 44,428.10.

The index oscillated between the intraday high and low by 290 and 254 points.

The market opened in the positive and cheaper valuations attracted buyers in the lead of insurance companies which took fresh positions in stocks worth $3.61m, followed by purchases by brokers and insurance companies. Individuals decided to take profit through sale of stocks of $3.60m and mutual funds offloaded shares valued at $1.77m.

Investors were taken aback by the rejection of the cabinet to approve import of cotton yarn from India, which added to confusion. Analysts said that the leverage positions in technology and refinery stocks were continuously causing selling pressure in the market, whereby declining prices of pertinent stocks made the investors revisit their earlier investment decisions. Netsol Technology hit its lower circuit while Attock and National refineries also ended on heavy losses.

The steep rise in the value of the rupee attracted investors to the automobile and other cyclical sectors in early hours as investors figured out substantial drop in cost of raw material. However, the stocks succumbed to panicky selling pressure in late hours.

Sector-wise the major negative contribution to the index came from technology, cement, banks, refinery and oil & gas marketing companies. Stocks that contributed negatively included TRG (108 points), Lucky (20 points), PSO (19 points), ATRL (18 points) and MEBL (18 points).

Traders said that reports regarding vaccine manufacturing by Searle helped the stock take a leap towards upper circuit. Similarly, Engro hit upper-circuit on the expectation of new investment in a polypropylene plant.

Published in Dawn, April 2nd, 2021