KARACHI: The stocks continued their losing streak on selling spree for the fourth day with the investors attempting to ditch the risky assets in panic just about an hour before the close. It saw the index succumb to intraday low by 750 points.
The recovery in the last hour prompted by banks which took fresh positions at dips, helped the index to bounce back a bit and close with a loss of 519 points, or 1.12 per cent, at four-month low at 46,009 points.
The market opened positive on gains in banking stocks as the SBP raised the interest rate by 25 bps to 7.25pc. The index climbed to intraday high by 305 points. It was difficult to explain what rocked the boat, though rollover week could have been a matter of concern. A major brokerage house stated: “Despite low leverage level in the market in DFC, MTS and MFS segments, index melted due to calls of redemption at mutual funds”.
Global stocks fall was halted after money managers assured investors that the collapse of property giant China Evergrande Group’s crisis was not likely to destabilise the world financial system and the economy. A few analysts reckoned that the impact travelled to the PSX which unnerved investors who preferred to offload positions.
The trading volume jumped 67pc over the previous day to 326m shares. Telecard Ltd topped the volume leaders’ list. All heavy-weight shares in technology sector—Systems, Netsol, AVN and TRG dipped in the red.
Foundation securities stated that the market had overplayed the concerns of recent hike in energy prices and thus opened significant room for upside for cement stocks. But other analyst said that the pressure was witnessed in the cement sector on the back of interest rate hike where Flying, Dandot, Pioneer, Kohat, Maple Leaf and D.G. Khan were the major losers.
Banks, fertiliser, refinery and E&P sectors also contributed to the free-fall of the market. Stocks that dragged down the index included Systems (53 points), MEBL (37 points), HBL (34 points), Lucky Cement (32 points) and TRG (23 points).
Published in Dawn, September 22nd, 2021