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Karachi stock exchange -100 index lost 462 points amid political uncertainity

Stock market saw a depressive week as Karachi stock exchange-100 index lost 462 points during the week.The market sentiment was mainly influenced by the falling international crude prices and selling pressure in the top ranked companies. Domestic and foreign investors were not ready to make fresh investments in the stock market due to unclear market situation. The foreign investors sold net equity of $ 2.95 million as compared to last week’s inflow of $ 1.9 million.

Karachi stock exchange-100 index started the week at 39926 points and ended the week at  39464 points.The weekly share trading volume  showed a 60.20 % increase as compared to the last week.The weekly share trading volume was 1950 million as compared to the last week’s 1219 million share volume.

 

stock market

Source : Express Tribune

The stock market started the week at a positive note due to initial positive sentiments.The Karachi stock exchange -100 index increased by 96 points on the first trading day of the week.The stock market failed to live up to the investor’s expectations and lost 558 points during the last four trading days of the week.The profit taking by the investors,bad security situation in the country and falling oil prices were three main reasons for this fall of the stock market.Following are the top gainer and loser companies of the week.

Top 5 Gainer companies

Top 5 Losers of the week

Source : KHI Stocks

Best and Worst Performers at the stock market

Auto sector remained the top performer at the stock market.Its good performance was mainly due to the   depreciating of the yen by 1.7% and positive news about different car models introduced by the auto sector. Ghani Automobile was the top stock of this sector.Its share prices appreciated by 35.25 % during the week.

Banking,cement and energy sectors were worst hit by the stock market fall during the week. HBL, OGDCL and Lucky cement collectively added 222 negative points to the Karachi stock exchange -100 index during the whole week.

Mari Petroleum, OGDCL and POL were three main bad performing shares of the  energy sector.The stocks of Mari Petroleum, OGDCL and POL were three main shares of the sector lost their value by -4.03 %,-3.30 % and -2.31 % during the week.

Lucky cement was the most affected share of the Cement sector.It lost its value by 6.55 % during the week. HBL was the worst affected share of the banking sector and its lost their value by 1.85 % during the week.

Future Outlook

Market analysts are expecting a mixed trend in upcoming days.They believe that local political environment and fluctuations in the international oil prices will play most important role in influencing the  investing behaviors in next week.

Currently US is having highest crude inventory in last few decades.This thing is putting enormous pressure on the oil prices and affecting the oil demand in the international market.If we talk about Pakistani political environment,it is very fragile right now. Government is not ready to solve the Panama leaks issue with a solution acceptable to all the stakeholders of Pakistani politics. PML-N government is just adopting a reactionary approach and it is dragging the matter. PML-N government must take action to solve this matter as soon as possible. As this matter can affect the stock market in a very negative way.

By analyzing the above mentioned facts,we can conclude that investors should adopt buy and hold investing strategy.They can buy blue chip stocks in good earning sectors like cement sector.Cement sector is currently best investment option for all types of investors.

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About Emaad Qureshi