Equity market plunges by over 600 points on selling pressure

KARACHI: The equity market plunged by over 600 points on Wednesday owing to selling pressure and proposed treasury single account.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 36,753 points as against 37,382 points showing a decline of 629 points.

Analysts at Arif Habib Limited said that the profit booking at the bourse turned into panic selling, courtesy of banking sector.

Market opened 5 points plus and could gain a total of 37 points after which the selling pressure started building.

O&GMCs, Cement and Fertilizer were the sectors that saw some uptick in the beginning however, selling pressure in Engineering (ISL) on the back of yesterday’s disappointing result and Banks (due to proposal of setting up Treasury Single Account) caused havoc.

BOP saw lower circuit breaker and +50M shares by the end of session.

Amongst other banking sector scrips, HBL also saw lower circuit that added pressure on the Index.

Overall, Banking sector realized 65M shares, followed by Vanaspati (UNITYR1) and Cement. Besides BOP, MLCF and FCCL ranked among top 10 scrips in traded volume.

Sectors contributing to the performance include Banks (-245 points), Power (-58 points), O&GMCs (-46 points), E&P (-38 points) and Cement (-38 points).

Volumes bounced back from 140 million shares the other day to 173 million shares (+23 percent DoD). Average traded value also increased by 5 percent to US$34.8 million and from US$33.3 million.

Stocks that contributed significantly to the volumes include BOP, UNITYR1, MLCF, TRIBL and LOTCHEM, which formed 54 percent of total volumes.

Stocks that contributed positively include POL (+10 points), KTML (+4 points), NRL (+2 points), SCBPL (+2 points), and LOTCHEM (+2 points). Stocks that contributed negatively include HBL (-97 points), HUBC (-38 points), NESTLE (-28 points), OGDC (-26 points) and BOP (-24 points).

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