With a majority of the results being declared and very few results left before the end of the month end, investors are more inclined towards profit booking. In light of the prevailing market sentiment over the past few days, benchmark witnessed a sustainable selling pressure which consequently turned the market in a bearish mood.
The rollover monster continued to erode the cultivated land, thus forcing the local bourse to undergo an extended spell of adjustment, while jittery on foreign dumping and gloomy economic and financial environment disallowed even the corporate participants from taking advantage of the huge discounts in fundamentally strong stocks likely to continue the growth spree on earning and payouts. Extreme pressure in various high priced and the frontline stocks likely to continue to bear the brunt of gas curtailment along with inefficient yet expensive debt portfolio.
KSE 100 index closed at 11377.61 levels with the loss of 139.68 points, while KSE 30 index lost 217.47 points to close at 10678.73 levels. All Share index closed at 7896.61 levels after losing 99.27 points. Total 88 scrips advanced 204 declined and 20 remain unchanged out of total 312 scrips traded.
However, cautious accumulation came in around midday wherein selective stocks away from various economic and infrastructural issues resisted the bearish forces. Short covering from the day’s low allowed the benchmark to stage an intra-day recovery, and the nervousness kept even the corporate participants cautious.
Although various corporate announcements did carry enough sensation to excite market participants, dumping by offshore participants and hefty rollover volume along with vague economic and financial picture disallowed aggressive resistance. Cautious accumulation in selective stocks mainly those likely to continue reporting growth in earnings and payouts did restrict wide-spread decline, however the companies likely to bear the brunt of high and expensive debt along with that of gas curtailment stayed under extreme pressure.
Bilal Asif at HMFS believes that with non-availability of triggers going forwards, the bearish momentum may dominate the proceedings at the local bourse. Most of the results were in accordance with analyst expectations, including today’s HUBC results while FFBL beat the analyst expectation. ‘We believe caution needs to be adopted while buying any stock or preferably investors having an appetite to acquire stocks need to wait a little while before they may capture the set of stock at reasonable prices,’ he added.
Hasnain Asghar Ali at Aziz Fidahusein said that debt repayment that starts early next year and absence of IMF monitoring and deteriorating economic benchmarks undoubtedly will keep economic and financial horizon polluted, however widespread triggers will keep the episodes of snap rallies alive, caution therefore stays the call. Since political and geo-political environments are likely to stay volatile, extreme movements will continue to provide sector and stock swapping opportunities. While companies exposed to various visible threats in the economy, along with those struggling to find sustainable multiples can be looked for off-loading or short selling, he added.
