Uncertainty on caretaker setup sends stock falling
KARACHI: Stocks went into free fall on Friday, the last day of rollover week for future contracts with KSE-100 index tumbling 462.07 points (1.09 per cent) to close at 42,074.09.
The uncertainty on the political front with the government and opposition failing to reach consensus on nomination of the caretaker set-up and economic worries sat heavily on the investors’ mind. The massive sale by foreign investors of equity worth $8.01 million a day earlier also caused jitters as the foreign outflow over the last nine sessions topped $44.81m. According to the latest figures released by the National Clearing Company of Pakistan, foreigners slowed down the sell-off to $1.26m.
The heavyweight banking sector, which had bore the brunt of ongoing foreign selling with net outflow of $25.9, showed little enthusiasm on the expected rate rise in the monetary policy statement which was to be unveiled later in the day. Investors also viewed with concern the widening current account deficit and declining foreign exchange reserves.
The market remained unimpressed by the news of currency swap arrangement (CSA) between the State Bank of Pakistan and People’s Bank of China extended for three years increase in the CSA amount.