Stocks fall below 43,000 level
KARACHI: Stocks remained subdued for the second day of the week as the global markets were rattled over the second and more contagious strain of coronavirus.
International oil prices plunged as demand was feared to decline on revision of the pandemic impact on world economies. After an initial gain that took the KSE-100 index to intra-day high by 145 points, it succumbed to selling pressure across the board.
Exploration & production, banks and cement sector stocks came in for major drubbing. The KSE-100 index plunged by 427 points (0.98 per cent) and closed below the 43,000 level at 42,907 points.
Besides the impact of global markets, most analysts also attributed the steep decline in share values to the prevailing roll-over week settlement. But the research desk at AHL Ltd noted that international crude oil prices remained subdued after Monday’s blow which caused selling pressure in E&P stocks.
“Similarly, foreign investors have been spring cleaning their holdings in the banking sector, before the close of the calendar year, which has played a significant role in bringing the index as compared to the general ‘ill-founded’ notion of rollover week pressure,” AHL analysts said.
On the positive side, the current account recorded its fifth straight month of surplus in Nov 2020 and Pakistan managed to secure a $1.7bn debt relief deal with G-20.
Foreign investors continued their sell-off; outflow on Tuesday amounted to $2.55 million. Among local participants, brokers proprietary trading saw a sell-off of shares worth $1.48m.
The liquidity was mopped up by insurance companies who bought shares of $2.55m and banks which purchased stocks valued at $1.23m. Volumes increased from 516.4m shares to 561.9m shares (up 9pc day-on-day). Average traded value maintained the level at $140.9m as against $140.3m (up 0.4pc DoD).
Volume leader of the day was Worldcall Telecom Ltd that saw 71m shares change hands. Stocks that exerted the greatest pressure on the index included TRG Pakistan, Pakistan Petroleum Ltd, Oil and Gas Development Company, Avanceon Ltd, Habib Bank Ltd and United Bank Ltd and Netsol.
Published in Dawn, December 23rd, 2020
