Equities close as investors fear political unrest

Author: Khurshid Ahmed

Karachi: Pakistan equities continued to decline on Tuesday with KSE100 Index settling down by 465 points and 109 million shares changing hands at the exchange. Market witnessed its lowest closing of 2017 as investors preferred to sell stocks due to the prevailing political uncertainty.

Stocks closed lower on investor concerns for economic uncertainty amid surging current account deficit and rupee depreciation. Dismal data on external account for Jul-Nov’17, ongoing political noise, and late session institutional selling on rising fund redemption played a catalyst role in bearish close at PSX, commented Ahsan Mehanti, a senior analyst.

Major drag to the performance came from the energy sector as sentiments were dented post-premier advising power ministry to completely phase out FO-based power generation going forward due to their negative fallout on environment. Kot Addu Power KAPCO PA -5%, Attock Refinery ATRL PA -4.7% and National Refinery NRL PA -5% traded at their respective lower price limits, while Pakistan State Oil (PSO) PA -2.8% that commands 75 percent market share in the FO segment also traded under pressure.

Meanwhile, on the corporate front, Nishat Mills NML PA -1.6% reiterated its intention of offering 18 percent stake to the Millat tractors MTL PA -0.6% in its newly formed subsidiary Hyundai Nishat Motors.

Participation improved as volumes were up 117 percent d/d while traded value rose 78 percent.

Top index point decliners were DAWH (-3.9%), SNGP (-4.9%), HUBC (-2.1%), KAPCO (-5%) & MARI (-3.6%) that withheld 134 pts while stocks including HBL (+1%), UBL (+1.3%), LUCK (+1.2%), COLG (+3.3%) and PGF (+5%) added 74 points.

On the sector front, E&P shed 74 points and OMCs 73 points, power and fertilizer were down 61 points each, cement was down 49 points, engineering 23 points, tech 21 points, refinery 19 points, whereas banks gained 14 points. Analysts expect the market to be driven by political noise in the near-term as Pakistan Awami Tehreek (PAT) has announced to give future roadmap by end of December.

Published in Daily Times, December 20^th2017.