KARACHI – Pakistan stock market nosedived largest since August 2017, ondecision of Avenfield Reference, Pakistan capital market recorded a declineof 1200 points during the session which was the largest fall since August2017 where financial institutions sold large chunks of blue chips, tradingand investment shares on back of noise of general elections, weak economicindicators and continuous selling from foreign investors.
An analyst from Ismail Iqbal Securities said that the market witnessedworst decline in percentage terms since August 15, 2017. Bearish sentimentwas attributable to the upcoming verdict on Avenfield case that will affectthe political future of a major political party, PML-N.
Banks were able to perform slightly on inflation numbers keeping up hopesof further rate hikes. Fertilizers also performed relatively better becauseof the local price outlook. Cements, on the other hand, were some of theworst performers as investors doubted whether the recent gains in pricescould be maintained.
An analyst from Arif Habib said market went down because of warning flashedby Fitch on Pakistan s on Pakistan economy and pending decision onAvenfield case pertinent to Nawaz Sharif.
Institutional selling came from mutual funds and foreign side had to revisetheir offers down to hit execution. Weak investor sentiment rings alarmbell for the prospective sellers. Selling was witnessed across the boardand almost all blue chips were seen red, most of the stocks hitting lowercircuit.
The index plunged by more than 1200 points which has been the singlelargest decline since the beginning of 2018 and since last nose diveaccorded in August 2017. On August 15, 2017 when market showed a fall of1389 points where the reason was same as of today political humming, dreareconomic picture, widening current account deficit and outflow from foreignfund houses.
The KSE-100 index closed 2.9 percent slipping below 41000 points level to40345 points. The market capitalization recorded an erosion of nearly Rs233 billion.