Vagueness over FATF keeps market bearish

KARACHI: Market observed an overall depressive session closing lower by almost 1 per cent. Market started bearish as investors stayed uncertain regarding the FATF meeting which is to take place on 21st January 2020. Higher than anticipated current account deficit number was another reason of overall market decline.
The benchmark KSE-100 index closed lower by 420.14 point to close at 42,747.62 points. KSE All Share Index decreased by 189.84 to end at 29,808.60, KSE 30-Index declined by 198.43 points to conclude at 19,798.84 whereas KMI 30-Index dipped by 1,037.56 points to finish the day at 69,238.86 levels.
Fahad Qasim at Topline Securities said market remained largely under pressure during the course of the day to close at 42,748 level (down by -0.98%). Bearish activity can be attributed to negative news flow as CAD number clocked in at US$ 367mn for Dec-19 higher than market expectation and LSM data showed decline of 4.6% YoY for the month of Nov-19. Ready market traded volume decreased by 17.7% DOD to 174mn shares, whereas traded value increased by 12% DOD to Rs.7.05bn. As per news report Economic
Coordination Committee (ECC) has approved reduction in GIDC for the fertilizer sector to lower urea prices by Rs400/bag; resultantly FFC (3.09%) and FFBL (5.5%) in fertilizer sector gained, whereas ENGRO (-3.69%) & EFERT (-5.48%) closed lower, as they stand to lose form decline in GIDC prices due to their concessionary gas price agreement.
The advance to decline ratio in the broader market remained in favor of bears. Out of 353 scrips, 70 scrips advanced, 263 declined while the value of 16 scrips remained intact.
The ready market volume decreased by 17.74 per cent to 173.897 million shares as compared to 211.407 million shares traded on last trading day.
Engro Fertilizer Limited topped the list of actives, closed lower by Rs 4.13 at Rs 71.17 on 15.27 million shares followed by TRG Pakistan Limited declined by Rs 1.25 at Rs 27.42 on 11.90 million shares and Bank of Punjab decreased by Rs 0.20 at Rs 13.70 on 11.71 million shares.
Other actives were WorldCall Telecom Limited which descended by Rs 0.03 at Rs 1.25 on 9.75 million shares and Summit Bank Limited improved by Rs 0.43 at Rs 2.06 on 9.31 million shares.
According to Aba Ali Habib Research Desk bourse opened on a weaker note on Monday, dropped over 420 points as Pakistan prepares to meet FATF’s working group on 21st January (tomorrow) in Beijing. The four-day meeting is of high importance for the country as the working group will scrutinize Pakistan’s efforts to adopt strict laws against terror financing and money laundering. Investors’ interest remained weak throughout the trading session due to recent wheat crisis despite government’s claims of sound economic policies and food security. During the session, the index found its support and resistance at 42,632.58 ppts and 43,302.61 ppts, respectively. Sector-wise, commercial banking sector remained most traded sector in today’s trading session owing to uncertainty related to FATF’s upcoming meeting. Among major banks, UBL lost PKR 3.56 from its share value followed by HBL (-PKR 2.28), MEBL (-PKR 1.31), MCB (-PKR 1.19) and HMB (-PKR 1). The bourse witnessed the volumes of 173 mn shares, against 211mn shares a day before. The traded value clocked in at PKR 7.05bn. The advance to decline ratio remained in the favour of bulls where 251 closed green, 74 scrips closed red and 16 remained unchanged. Commercial banks sector was the top traded sector in today’s session with the share volumes of 27.1mn shares followed by Technology & communication (25.6mn shares), Fertilizer (25.3mn shares), Cement (16n shares) and Inv. Transport (12.16mn shares)
The overall market capitalization dipped by Rs 51.205 billion to Rs 8.0339 trillion against Rs 8.0851 trillion observed on last trading day.
Colgate Palmolive Limited and Mari Petroleum Limited remained the top gainer by Rs 86.33 and Rs 75.08 to close at Rs 2,461.33 and Rs 1,440.26 respectively, while Sapphire Textile Mills Limited and Indus Dyeing Mills Limited were among the major losers which lost Rs 35.99 and Rs 30.05 to close at Rs 900.01 and Rs 527.00 respectively.

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