Failing to hold on to the bullish trend, the KSE-100 Index dropped 106 points to close at 11,763 points on Tuesday, November 1. Volumes dropped below the 100 million mark yet again with 84.4 million shares being traded in the first session of November.
After gaining more than 550 points in the last two sessions, a technical correction was highly anticipated in the market and it turned out to be the same. Out of the total 337 companies traded during the session, 186 ended in the red zone, 126 gained from
where they closed in the previous session and 25 remained unchanged.
In the wee hours, the market experienced a gap opening of around 100 points, but intense selling pressure then took toll and pushed the index into negative, causing a volatility of more than 200 points. FFC, Fatima Fertiliser and OGDC led the pressure in
the market, with FFC being the most volatile scrip.
Selling was observed in OGDC yet again and it is now becoming evident that the foreign investor is disinvesting in this scrip. Mr. Ali Nadeem, Manager of Equity Sales at First National Equities agreed with the proposition and added that with the result season
now effectively over, there is no positive news to attract investment in the market.
He continued that the increasing political uncertainty in the Country and growing tensions with America are not a congenial signal for foreign as well as local investors. Ali furthered that most companies have shown growth in this quarter, but the result
has not been absorbed by the market in spirit.
The law and order condition of Pakistan is on the decline and with energy crisis in the offing; an immediate solution to the deteriorating investment climate of Pakistan does not seem to be on the agenda of the leadership.
ENGRO and PSO performed against the market sentiment and closed in the positive zone, primarily due to a post result rally. Both companies announced favourable results on Monday, October 31 and it is expected that investors will continue the buying spree
for the next few sessions as well.
While the negatives outweighed the positives, there is little hope for investors when the market re-opens on Wednesday, November 2. The Index crossed the 12,000 barrier today, but could not sustain this level. It will be interesting to see how things unfold
in the next session.