KSE index loses 631.88 points

KARACHI (January 19 2009): The Karachi share market failed to maintain last week''s momentum and the benchmark KSE-100 index fell below the psychological level of 6,000 points during the outgoing week mainly due to selling pressure by foreign investors.

The market witnessed lackluster performance and the index lost 631.88 points on week-on-week basis to close at a four-year low level of 5,511.93 points.

The overall market capitalisation declined by Rs 193 billion to Rs 1.743 trillion. The foreign investors remained net sellers and withdrew $12.8 million during the week. The average daily volume at ready market declined by 25.9 per cent to 128.663 million shares as compared to previous week''s average of 173.6 million shares.

The week started with a negative trend on Monday and index lost 102.37 points to close at 6,041.44 point level on the first day of the week with the total volume of 123.007 million shares. The market witnessed a volatile session on Tuesday, however, it managed to close in positive at 6,059.09 points level, up by 17.65 points with 165.311 million shares.

On Wednesday the market witnessed another volatile session and index lost 7.93 points to close at 6,051.16 points with 160.620 million shares. The index fell below 6,000 psychological level to close at 5,778.58 points level with a heavy loss of 272.58 points with 122.114 million shares.

The bearish trend continued on Friday and the index lost another 266.65 points to close at 5,511.93 points level with 72.263 million shares.

Atif Zafar, an analyst at JS Global Capital, said that the index witnessed a lackluster performance during the week and fell below the 5,000 psychological level amid foreign selling. Volume in the ready market suffered over the week as weak sentiments prevailed at the bourse. Selling pressure by foreign investors continued as they bought shares worth only $14 million and sold $26.8 million, resulting in net selling of $12.8 million. The cumulative net selling by the off shore investors for the month has now reached at $62.3 million.

National Investment Trust (NIT) with its State Enterprise Fund has started buying shares at the KSE from Tuesday to provide much needed liquidity to the market.

Romessa Mirza at Invest Capital Securities said that the index showed wide fluctuation throughout the week amid prevailing uncertainty. The average volumes declined to 129 million shares, however, are still a massive 182 per cent higher than the average volume of 46 million shares witnessed in FY09 to date.

The highest volumes were generated in WTL (58 million), PPTA ( 51 million), OGDC (50 million), PTC (26 million), NIB (23 million) and NBP (22 million).