Business

KSE-100 falls 184 points, ends fifth straight session in red

The KSE-100 Index retreated further on Wednesday as it continued its downward journey for the fifth successive session, finishing the day’s trading below 44,100 points.
The trading began on a positive note in the morning with the index surging 300 points to hit an intra-day high of 44,533.76. However, it failed to sustain the momentum and dipped 537 points later.
The gloomy outcome could be attributed to low expectations from the ongoing corporate results’ season which pushed investors to the sidelines. Additionally, institutional selling also dragged the market down.At close, the benchmark KSE 100-share Index recorded a decrease of 184.06 points or 0.42% at 44,049.05.
Elixir Securities’ analyst Ali Raza said Pakistan equities closed negative for the fifth day in a row, dragged down by losses in notable blue chips on institutional selling. The index stood above 44,000 points.
“The market saw lacklustre activity in the initial hours, however, gains in select names helped the KSE-100 Index rise to test 44,500 in intra-day trading,” Raza said.Fauji Fertilizer Company (FFC, +3.1%) extended gains and generated three-week high volumes due to the stellar results announced on Tuesday. Engro Fertilizers (+1.3%) also sparked activity and gained on expectations of better earnings.
Afterwards, losses in select index names across financial stocks including United Bank (UBL, -4.1%), MCB Bank (-2.8%) and Habib Bank (HBL, -0.8%); cement stocks like Lucky Cement (-2.6%) and exploration and production stocks such as Oil and Gas Development Company (OGDC, -1.6%) on aggressive institutional selling, reportedly from foreigners, dented sentiments and led to a negative close.
On the corporate front, Dewan Cement (+2.9%) traded at its upper price limit after investors were notified of the intention to acquire 12.5% of the company shares from minority shareholders by Mega Conglomerate for Rs23.20 per share, following the purchase of a majority stake.
At the public offer price, Dewan Cement’s FY17 price-to-earnings ratio stands at 8.6x, compared to sector’s average of 10x.
“[We] see volatile and range-bound trading in the near term with flows continuing to guide market’s direction,” the analyst added.
JS Global analyst Maaz Mulla said volatility prevailed in the market as the KSE-100 Index remained range bound between an intra-day low of 236 points and intra-day high of 300 points.
“The exploration and production sector continued its declining trend as crude oil prices fell in the international market below $70 per barrel. OGDC (-1.63%) and Pakistan Oilfields (-0.19%) were major losers of the sector,” Mulla said.