Bears tighten grip on KSE

The uncertainties regarding the outcome of the meeting between KSE management and the regulator about CFS encouraged the bears who tightened their grip at Karachi Stock Exchange on Monday. The market touched 9,876.84 points intra-day low following the cautious stance of investors.
Finally, the KSE-100 share index fell by 72.44 points to close at 9,892.77 points, while the KSE-30 share index shed 88.52 points to 12,339.54 level. The volume reduced to 60.092 million shares from 98.673 million shares of last Friday.
Of the companies traded, 195 scrips closed in negative column, 79 scrips closed in positive, while the value of 29 scrips remained unchanged. Overall market capitalisation declined by Rs 20 billion to Rs 2.774 trillion.
The market opened on a positive note and at one time the index hit the intra-day high of 9999.77 level. However, selling pressure in banking and energy stocks did not allow the index to stay in the green territory.
Uncertainty on regulatory front compelled investors to offload their holdings. Ahsan Mehanti of Shehzad Chamdia Securities said that the record low volume and liquidity shortage hurt the investors'' sentiment who opted for cautious attitude. Besides, consistent declining oil prices in the international market restricted the bulls.
Tanveer Abid at Live Securities said that amid extremely low volumes in the ready market, the KSE-100 index depicted 72 points (0.7 percent) decline to close at the 9892.77 points level. Investors remained on the sidelines as the ready market volumes were extremely thin at 60 million shares as against 98.673 million shares traded on Friday.
The market started off on a positive note on the back of news regarding gas discovery and privatisation prospects of major entities. However, the index plummeted into the red following the absence of buyers.
Among the volume leaders, NBP, D G Khan Cement and PPL posted 1.8 percent, 1.8 percent and 1.5 percent declines respectively to close at Rs 224.50, Rs 93.20 and Rs 230.50. OGDCL also closed in the red at Rs 125.50, 0.6 percent lower despite reports about discovery of new gas reserves. On the other hand, SSGC gained 2.1 percent following the news that the company is trying to secure LNG contracts, while SNGPL also depicted Rs 0.35 increase.
Mixed performance was evident in banking scrips as MCB and BoP posted 0.8 and 0.6 percent declines while Askari Commercial Bank and Faysal Bank closed in the positive zones. Lucky Cement lost 2.9 percent to close at Rs 97.90 despite exceptional hike in the earnings and a little payout. In the broader market, losers outnumbered gainers with a margin of 2 to 1.
Faiza Naz at Jahangir Siddiqui Capital Markets said that the market opened 20 points up from Friday''s level and touched 9,999 index levels. But due to extreme low volumes the market could not sustain Friday''s level. The main reason to this lacklustre market activity was investors'' concern over amended CFS. Also, the KSE management and SECP personnel were expected to meet to discuss proposed amended CFS.