KARACHI, Aug 6: The KSE 100-share index on Monday plunged by 253 points on panic-selling triggered by a combination of negative factors notably SECP notices to some brokers for their alleged involvement in June 2006 market crash and suspension of trading in HBL shares.
The absence of buyers at the falling prices further accentuated the situation as there were more sellers than buyers amid mounting selling offers. The SECP has sought details of short-selling from some of the brokerage houses and leading among them resorted to panic-selling for obvious reasons.
However, trading in the Habib Bank shares which was suspended temporarily to avert fresh fall in its price, is expected to be resumed by Tuesday as the matter is resolved, floor brokers said.
The fears of political turmoil triggered panic-selling by all and sundry as the President had reportedly decided to seek re-election by the present assemblies possibly on Sept 15.
The KSE 100-share index suffered a fall of 252.57 points or two per cent at 13,510.59 as compared to 13,763.16 at the last weekend eroding Rs71 billion from the market capital at Rs3,969.00 billion. The KSE 30-share index shed 389.20 points at 16,177.80.
What seems to have worried both local and foreign investors was the opposition’s stand to challenge the re-election both in the apex court and on the street, which analysts fear will lead to law and order situation and political instability.
Bank, oil and other overvalued shares received massive battering after a section of foreign investors indulged in panic selling, notably MCB, National Bank, OGDC, Hub-Power and Lucky Cement.
Analyst Faisal A. Abbas said the market was largely weighed down by some of the highly sensitive external factors as was reflected by falling volume figures and sanity may only return to the market unless some of the immediate irritants were not removed.
The other negative factor which hastened the market decline was fresh threats from the US to strike targets in Pakistan to wipe out Al Qaeda safe havens in the tribal areas, some others said.
“Despite higher corporate earnings and payouts, from now on political factors may guide the future market direction as investors think twice before taking any decision for investment amid worsening political scenario,” analyst Ahsan Mehanti said, adding “fresh notices by SECP also worked against the sentiment”.
Massive battering received by the market trend-setters, National Bank and MCB, notably on the forward counter reflects that the long-term investment scenario is not that encouraging, he added.
Minus signs dominated the list under the lead of Siemens Pakistan and Lakson Tobacco, off Rs78 and Rs29 followed by Pakistan Refinery, National Refinery, Mari Gas, HinoPak Motors, JS Global, MCB, EFU General, Colgate Pakistan and Shell Pakistan, which suffered fall ranging from Rs14.35 to Rs22.60.
There were several other losers, which fell by Rs8.05 to Rs9.50, ICI Pakistan and Adamjee Insurance being notable among them.
But Unilever Pakistan and JS & Co managed to put up fresh gains of Rs25 and Rs44.40 respectively. Fazal Textiles, Dawood Lawrence, Gillette Pakistan, Central Insurance, Pak Reinsurance Co, Bestway Cement and EFU Life followed them, up by Rs3 to Rs17.35.
Trading volume shrank to 175m shares from the previous 229m shares as losers held a strong lead over the gainers at 254 to 78, with 23 shares holding on to the last levels.
The active list was topped by Fauji Fertiliser Bin Qasim, lower by Rs1.15 at Rs46.35 on 15m shares followed by Bosicor Pakistan, easy by 70 paisa at Rs20.60 on 12m shares, Lucky Cement, off Rs3.75 at Rs122.75 on 10m shares and Hub-Power, easy Rs1.80 at Rs34.40 on 8m shares.
Javed Omer, up by Rs2.85 at Rs221.15 on 7m shares, Arif Habib Securities, lower by Rs2.20 at Rs126.80 on 7m shares, OGDC, off Re1 at Rs120.75 on 6m shares and Askari Bank, up by 40 paisa at Rs95.85 on 5m shares.
Other actives were led by Fauji Cement, up by 20 paisa on 7m shares and TRG Pakistan, lower 50 paisa on 5m shares.
FORWARD COUNTER: Lucky Cement led the list of actives, off Rs4 at Rs123.20 on 10m shares followed by National Bank, sharply lower by Rs6.90 at Rs251.75 on 5m shares and MCB, lower by Rs14.70 at Rs310 on 3m shares.
Fauji Fertiliser Bin Qasim, off 90 paisa at Rs46.30 on 3m shares and Bank of Punjab, lower by Rs4.45 at Rs104.10 also on 3m shares.DEFAULTER COS: Zeal Pak Cement came in for active selling and was marked down by 25 paisa at Rs6.70 on 4.437m shares followed by Japan Power, easy by 50 paisa at Rs8.70 on 0.723m shares and Nimir Chemical, easy by 30 paisa at Rs4.40 on 0.663m shares. S.S. Oil was quoted higher by Re1 at Rs21.05 on 0.196m shares.