KARACHI, Aug 29: The bears charged on the Karachi stock market on Wednesday knocking off 83.17 points from the KSE-100 index, which settled at 15,151.31 points.
Most market participants did not express distress, saying that it was only natural that the investors should resort to profit-taking, following gigantic gains of 200 points in the last two trading sessions.
The market started out on a dismal note for there was not much to cheer either in the news bag or the incoming corporate results.
The sentiments were further dampened by the news that the Competition Commission of Pakistan had some reservations on the development related to ICH (international clearing house), which sent shares in telecommunication sector especially PTC spinning down, which hit the lower lock. The selling soon spread to other sectors.
For all the enthusiasm of the brokers and traders, some signs were ominous: The steep drop of 100 million shares or 32 per cent in volume to 204 million shares on Wednesday, compared to 312 million shares traded the previous day. Trading value dipped by Rs3.07 billion to Rs4.208 billion, from Rs7.225 billion the previous day.
Yet the more worrisome issue noted on Wednesday was the closing of index below the day's lowest level of 15,127.91 points.
That made many wonder if the market was set to slide. However, most market participants took the decline for the day in stride.Ahsan Mehanti at Arif Habib Corp said that the stocks closed lower on profit-taking post major earning announcements at KSE. Consolidation in blue-chip stocks, uncertainty in global stocks and commodities, security concerns in the city and concerns for rising circular debt played a catalyst role in bearish sentiments at KSE.
Hasnain Asghar Ali, COO at Escorts Capital, stated that despite the automated roll-over window for future trades, the bulls in order to catch a breath took the overlapping period as an excuse for allowing technical adjustment. Consolidation was noted in some frontline stocks which had given out satisfactory stock and cash dividends while other stocks rallied in anticipations of healthy corporate profitability.
Traders could continue to enter into short term based while the funds capitalising on the opportunities surfacing due to availability of stocks on deeper discounts could pick up stocks, letting index rise higher.
However, law and order situation along with economic and financial vulnerability coupled with political volatility were impediments.
Among the 317 stocks that came up for trading on Wednesday, 177 were losers, 113 gainers and 27 closed unchanged.
Market capitalisation fell by Rs23 billion to Rs3.861 trillion, from Rs3.883 trillion on Tuesday.
The biggest losers for the day were Colgate Palmolive, down by Rs57.23 to Rs1296, followed by Mitchell’s Fruit Farms lower by Rs13 to Rs360. The two big gainers included Rafhan Maize up by Rs100 to Rs3,885 and Nestle Pakistan higher by Rs48 to Rs4,050.
Again bulk of the volume was noted in small cap stocks, with trading in seven stocks out of 10 priced below their par value.
PTCL which had been the maximum gainer for several days reversed its role to touch the minimum low of 91 paisa to Rs16.38 on 34m shares.
Pace (Pakistan) rose by 33 paisa to Rs3.10 on 16m shares, Telecard Limited shed 23 paisa to Rs2.44 on 15m shares, WorldCall Telecom slipped by 45 paisa to Rs2.71 on 12m shares and TRG Pakistan slid by 7 paisa to Rs4.04 on 11m shares.
NIB Bank was lower by four paisa to Rs2.40 on 10m shares, Jah Sidd Co was up 13 paisa to Rs15.60 on 8m shares, Fauji Cement slipped 18 paisa to Rs6.71 on 7m shares, D.G. Khan Cement added 30 paisa to Rs52.10 on 7m shares and Treet Corp (ROL) was up by 21 paisa to Rs2.73 on 6m shares.