KARACHI – Pakistan stock market nosedived largest since August 2017, on decision of Avenfield Reference, Pakistan capital market recorded a decline of 1200 points during the session which was the largest fall since August 2017 where financial institutions sold large chunks of blue chips, trading and investment shares on back of noise of general elections, weak economic indicators and continuous selling from foreign investors.
An analyst from Ismail Iqbal Securities said that the market witnessed worst decline in percentage terms since August 15, 2017. Bearish sentiment was attributable to the upcoming verdict on Avenfield case that will affect the political future of a major political party, PML-N.
Banks were able to perform slightly on inflation numbers keeping up hopes of further rate hikes. Fertilizers also performed relatively better because of the local price outlook. Cements, on the other hand, were some of the worst performers as investors doubted whether the recent gains in prices could be maintained.
An analyst from Arif Habib said market went down because of warning flashed by Fitch on Pakistan s on Pakistan economy and pending decision on Avenfield case pertinent to Nawaz Sharif.
Institutional selling came from mutual funds and foreign side had to revise their offers down to hit execution. Weak investor sentiment rings alarm bell for the prospective sellers. Selling was witnessed across the board and almost all blue chips were seen red, most of the stocks hitting lower circuit.
The index plunged by more than 1200 points which has been the single largest decline since the beginning of 2018 and since last nose dive accorded in August 2017. On August 15, 2017 when market showed a fall of 1389 points where the reason was same as of today political humming, drear economic picture, widening current account deficit and outflow from foreign fund houses.
The KSE-100 index closed 2.9 percent slipping below 41000 points level to 40345 points. The market capitalization recorded an erosion of nearly Rs 233 billion.