KARACHI – Investors were subdued at the local bourse for another day as the scrips of refineries remained under the weather, after news broke that the ministry of petroleum had informed oil refineries that the deemed duty protection of 7.5 percent will be eliminated gradually. Overall, market remained under a bearish spell with traded volumes of 78 million, amid selling by local institutions.
The KSE 100 index closed at 12,242.39 levels with a loss of 30.99 points while total volume stood at 64,266,436 along with the total value 3,899,265,780. The index was under immense pressure and continues to endure a bearish spell after hitting the high of 12,682 points in a recent rally with greater volume in contrast with preceding year’s average daily volume.
It seemed likely that after the index touches a high level, defensive investors prefer to book gains and wait to reenter the market. The benchmark has already lost over 440 points from its peak level. On the volumes chart, leaders remained LOTPTA, FFBL and ANL with volumes of 15.9 million, 5.1 million and 3.7 million, respectively. Among refineries, NRL and ATRL both closed at lower levels.
It is expected that the selective valuable stocks to gradually gain attention of prudent investors as the stocks have already lost substantial ground. Adopt wait and see approach would yield better result at current level. For the funds specified for equity markets, whether retail or institutional portfolios, relatively safer stocks, trading at low multiples with decent dividends and offering at least double digit yields are expected yield positive results.
Trading at inflated levels and the gloomy economic and financial situation along with accumulating debt and rising input cost along with a decline in both local and export demand are likely to triggering off-loading. Short term trading initiated either on technical calls or by holding companies and local financial groups should be avoided in case activity misses turnover and sustainable positive activity.
Technically, however it has been noted that the session following an extremely range bound and low turnover session will either way, provide wide spread trading opportunities to short-term traders, said Hasnain Asghar Ali at Aziz Fidahusein.
