KSE-100 Index: Daily Overview – October 27

Negative sentiment prevailed in the market yet again as the KSE-100 index lost another 104 points to close at 11,283 points on Thursday, October 27. The index shed 130 points yesterday to fall below the psychological barrier of 11,500 points and it now remains
to be seen if the 11,000 mark can be sustained.

After a gap-opening initially, the index remained under pressure for the larger part of the session, primarily due to the political instability that has taken a toll over the past few days. This proposition was presented by Mr. Ali Nadeem, Manager of Equity
Sales at First National Equities, who pointed out that upcoming political rallies in Lahore have forced the investors to remain cautious as far as buying is concerned.

The PML-N is carrying out a procession against excessive load-shedding on Friday, October 28 and PTI is scheduled to have a massive rally on Sunday, October 30. Market observers believe that a threat of an adverse incident during these processions is keeping
the investors abject and that the market will rebound once there is stability from all fronts.

With foreign investor among the sellers, the overall conditions are not congenial for investment. It will not be wrong to assert that the State Bank’s expansionary monetary policy has been ineffective thus far and raising questions on the approach will not
be erroneous.

Another major ingredient of keeping the market under pressure is the ever-growing burden of circular-debt. Sources have claimed that Rs. 1 billion is added to the amount of this debt on a daily basis and that PSO suffers the most because of this. Ali agreed
with this notion and added that this has been the sole reason why this scrip lost around Rs. 50 in the last few trading sessions.

NBP and OGDC announced their results today, but neither had a positive impact on the market. Although OGDC announced earnings of Rs. 5.10, the pay-out of Rs. 1.50 was below market expectations and thus did not instigate a rally in the scrip. NBP announced
earnings of Rs. 6.78 for the nine-month period, but there was no pay-out which kept the scrip under pressure throughout the session.

Short URL: https://www.newspakistan.pk/?p=1758

Posted by Hammad Malik on Oct 27 2011. Filed under Business. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry