KARACHI: Stocks suffered heavy decline on Monday with the KSE-100 index posting a loss of 403.09 points, 1.21 per cent, to 32,860.57.
Volumes tumbled below 100 million shares and trading value hit five-month low at Rs5.50m.
Foreign selling which amounted to $6.62m was at the heart of the market decline. Overseas investors shed $4.3m worth stocks in the cement sector and $1.8m from the banking sector. Foreigners have been net sellers of $64m worth stocks since January 2015.
Analysts at brokerage house Topline Securities concurred that in the absence of any major news, volumes remained dull and benchmark index fell on foreign selling.
Index heavy weight scrips MCB Bank, PSO and Lucky Cement fell sharply. MCB Bank declined by 3.1pc, which contributed 74 points in index fall. Institutional selling was seen in LUCK which fell by 3pc.“As a result the KSE market is now up 2pc only in 2015-to-date,” Topline calculated.
Analysts said that investors fear that with falling international markets, foreigners would also sell in Pakistan.
A stockbroker said on condition of anonymity that the recent aggressive risk management and enforcement measures by the chief regulator, SECP, issuing notices to leading brokers and fund managers forced investors to remain on the sidelines.
Analyst Ovais Ahsan at JS Global observed that the banking sector led the decline on expectations that a potential cut in the policy rate on the back of lower than expected inflation would shrink banking spreads going forward.
The cement sector continued to slide led by Lucky Cement taking a dip of 2.9pc and DGKC down 1.8pc.