KARACHI, Aug 21: The KSE 100-share index on Tuesday crashed from the recent highs by 3.5 per cent or 447.55 points on panic foreign selling triggered by strong rumours about the imposition of emergency or martial law, said a leading analyst.

It was for the second time during the last couple of weeks during the current month that the rumours of emergency have taken massive toll of the share values amid hasty selling by all and sundry and drove foreign investors out of the market since then, said a leading broker.

The index finally ended at 12,244.62 but well above the session’s low of 12,188.48, eroding Rs130 billion from the market capital at Rs3,585 billion.

“Some technical factors linked to SECP proposal, notably 50 per cent cash requirements at the time of delivery after the uncapping of CFS regime also weakened the underlying sentiment,” said a leading stock analyst Faisal Rajabali adding “higher corporate dividend and bonus shares, which could have been a major stimulant in normal trading conditions were neglected.”

However, it was not the largest single-session fall as the index had declined by 491.02 points or 4.43 per cent on March 8, 2006 and 547.93 points or 5.88 per cent on June 14, 2006 on default rumours of a member of the Lahore Stock Exchange, analyst Ahsan Mehanti said.

He said financial institutions have the funds and the institutional framework to steer the market out of the snap crisis but they are not inclined to take risks in the prevailing situations.

Corporate announcements from some of the MNCs, notably Colgate Pakistan and Clover Pakistan plus bonus shares and Attock Petroleum could have generated a lot of speculative buying and bargain-hunting in normal trading conditions but they too failed to boost the investors’ morale, analyst Hasnain Asghar Ali said.

“The falling volumes signal that the investors are not inclined to take even a calculated risk at the attractively lower levels, which ensure higher capital gains.

Minus signs dominated the list under the lead of JS & Co and Unilever Pakistan, off by Rs40 and 61.85 followed by Arif Habib Ltd, National Bank, Adamjee Insurance, EFU General, IGI, Pakistan Refinery, National Refinery, PSO, Pakistan Oilfields, Pakistan Petroleum, Indus Motors, Pak-Suzuki Motors, Engro Chemicals, Treet Corporation, Rafhan Maize, Sanofi-Aventis, and Colgate Pakistan, which suffered fall ranging from Rs10 to 18.90.

But on the other hand Fazal Textiles and Siemens Pakistan managed to finish higher with fresh good gains of Rs9.10 and 30, respectively. Others rose modestly. Trading volume showed a modest rise at 152m shares but was well below the normal daily figure as losers topped gainers by 305 to 44, with 16 shares holding on to the last levels.

OGDC topped the list of actives, sharply lower by Rs4.40 at Rs111 on 11m shares followed by Bank of Punjab, off Rs4.25 at Rs86.85 on 8m shares, PTCL, easy by Rs2.50 at Rs47.95 also on 8m shares, National Bank, off Rs10 at Rs224 on 5m shares, Bank AlFalah, lower Rs2.45 at Rs46.65 on 4m shares and Bank Islami Pakistan, off one rupee at Rs12.25 also on 4m shares.

Other actives included Bosicor Pakistan, easy by one rupee on 11m shares, TRG Pakistan, lower 70 paisa on 10m shares, Fauji Fertiliser Bin Qasim, easy 2.15 on 7m shares and Arif Habib Securities, off Rs6.35 on 6m shares.

FORWARD COUNTER: D.G. Khan Cement led the list of active on the cleared list off Rs4.75 at Rs92.20 on 6m shares, followed by National Bank, lower by Rs10.60 at Rs224.60 on 6m shares and OGDC, off Rs4.05 at Rs111.40 on 5m shares.