KARACHI, July 15: Stocks on Monday suffered widespread decline on panic selling triggered by fears of law and order situation followed by reports of death penalty to Omar Sheikh, the alleged killer of US journalist Daniel Pearl, by the anti-terrorist court.

The KSE 100-share index, which has been holding well, gave in under the weight of mounting selling offers and fell 47.82 points or 2.68 per cent, wiping out Rs9.371bn from the market capitalization at R405.670bn.

The death sentence to Omar Sheikh came just in the wake of massacre in Indian occupied Kashmir and its likely fallout on the Indo-Pak relations, having a negative impact on the underlying sentiment.

“The war hysteria is again around as India has blamed Pakistan for innocent killings,” brokers said, adding “fears of retaliation triggered panic selling from the jobbers and weak-holders.”

The market seems to have overreacted to both the negative news as weak-holders, who have been anticipating a rebound sold in a haste fearing further decline but institutional traders allowed price to fall further.

“I think technical correction is now overdue,” an analyst predicts. “It could manifest itself in a big any day during the current week.”

The market has been holding around the sustainable level though it remained in search of a definite direction throughout the last week awaiting the advent of financial support.

“After a month’s relative calm on the border and threatening statements on both sides of the border, investors were thinking the peace is around but the Jammu incident has altogether changed the situation,” says a leading broker.

The terrorist attack in Jammu came just in the wake of the US official statement that cross border infiltration in Kashmir is progressively falling.

However, leading analysts hope that the market will regain its lost level after the psychological impact of the killing is fully digested during the next couple of session, although local political polarization will continue to haunt investors.

“The National Bank annual profit and revenues were well above the analysts forecast but the condition that Rs1.25 per share cash dividend will be paid after the central bank approval disappointed investors and the consequent hasty selling,” dealers said. It ended one rupee lower at Rs18.95 around its circuit breaker but did not breach through it.

Its board, which met here last Saturday announced a cash dividend of Rs1.25 per cent on net income of about Rs17bn and pre-tax profit of Rs8.02bn.

The market decline was led by the energy sector under the lead of Shell Pakistan and PSO on selling prompted by reports that the oil marketing companies may reduce petroleum prices for the fortnight ended July 15, after two consecutive upward revision. Both fell by Rs5 and Rs6.65, respectively.

Other prominent losers were led by New Jubilee Insurance, Adamjee Insurance, Lakson Tobacco, National Refinery, Pakistan Oilfields, Clariant Pakistan, Siemens Pakistan and Lever Brothers, falling by Rs1.75 to Rs13.95.

Out of the only 20 gainers, Kohat Cement and Javed Omer were leading, up one rupee to Rs2.70, while others rose fractionally.

It was in this background that Bosicor Refinery was shifted from the provisional counter to the ready section and was marked down by Rs1.35 and finished below its par value at Rs8.55 on 0.635m shares.

Trading volume remained slow rising to 63m shares from the previous 21m shares as losers forced a strong lead over the gainers at 237 to 20, with 35 shares holding on to the last levels.

Hub-Power led the list of actives, off 70 paisa at Rs23.25 on 21m shares followed by PTCL, also down by 65 at Rs16.80 on 15m shares, PSO, sharply lower by Rs6.65 at Rs131.85 on 6m shares, FFC-Jordan Fertilizer, off 50 paisa at Rs6 on 4m shares and National Bank, lower one rupee at Rs18.95 on 2m shares.

Other actives were led by Sui Northern, easy 40 paisa on 1.411m shares, KESC, lower 20 paisa on 1.382m shares, Telecard, off 80 paisa on 1.374m shares, D.G. Khan Cement, lower 60 paisa on 1.218m shares and Engro Chemical, off Rs1.75 on 1.028m shares.

FUTURE CONTRACTS: Speculative issues on the forward counter also followed the lead of their counterpart in the ready section followed by heavy selling in Hub-Power, off 65 paisa at Rs23.40 on 10.256m shares, followed by PTCL, lower 60 paisa at Rs16.80 on 6.248m shares and PSO, sharply down by Rs6.85 on 4.205m shares. Others also fell modestly on light turnover.