Global downtrend triggers adjustment

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KSE 100 index ended the day down 84 points as reports circulated that Kunar Pasaki Deep and Tando Allahyar may be scrapped and lead OGDC to incur heavy losses. Major oil, fertiliser and banking stocks closed in the ‘red’, as thin volumes of 87 million shares were traded today. OGDC lost 1.2 percent, while shares in PPL dipped 1.7 percent despite hopes of an upward revision in gas wellhead prices in coming days.
The KSE-100 index closed at 12,179.81 with a loss of 84.25 points and total volume stood at 51,002,607 along with total value at 3,404,996,739. A total of 106 scrips advanced, 154 declined and 94 were unchanged out of a total of 354 scrips traded. Refining stocks were once again in the limelight, but investors opted to book profits in NRL, dragging the stock down 0.8 percent. ATRL producing 22 percent petroleum remained firm throughout the day as it stands to benefit from the increase in Mogas conversion to 91 RON from 87 RON. Banking stocks remained out of favor due to an expected rise in income tax on the sector in the upcoming budget. News of NPLs hitting a new high of Rs589 billion in the 1QCY11 did not nothing to encourage the banking sector as the stocks major players took a dip.  The lone shining star was SSGC which rose 1.57 percent from its previous close based on the news of its acquisition of Progas.
A bear run in various regional and international equity markets along with the advice of Washington’s think tanks suggesting a delay in aid to Pakistan resulted also contributed to the technical adjustment at the local equity markets. Since the decline was led by index heavyweight, the oil and gas sector, and duly followed by various high priced stocks, the price decline had a pronounced impact on the benchmark. Although, intra day dips did invite accumulation, the arrival of the budget and corporate off-loading kept activity restricted, therefore, keeping the benchmark under pressure during the trading session.