Late recovery helps index recoup intraday losses.
KARACHI -- The stock market remained in search of direction on Monday and closed with minor gain of 83.92 points (0.25 per cent) at 33,250.54.
Expecting a bull run following the agreement reached over the formation of a Market Support Fund, most investors were surprised to see the index open in the negative and nosedive to intra-day low by 814 points.
The sellers expressed worries over the hefty devaluation of the rupee and expectation of a major hike in the State Bank of Pakistan policy rate that could impact profitability of leveraged companies.
However, the oversold index managed to stem the tide of losses and stage a recovery. As the investors rushed to buy, the index took the flight north to touch intra-day high by 898 points.
Analysts at Arif Habib Limited stated that several stock especially those on the cement sector, hit their lower circuits. Exploration and production sector showed mixed reaction throughout the day, with Oil and Gas Development Company trading above last trading day's closing whereas Pakistan Petroleum Ltd (PPL) and Pakistan Oilfields Ltd saw attrition. PPL hit lower circuit, but recovered by the end of session.
Similarly, oil and gas marketing companies performed well and Sui Southern Gas Company (SSGC), Sui Northern Gas Pipelines (SNGP) were seen trading at upper circuits.
Automobile and government-owned stocks remained in lime light. State owned stocks like SNGP, SSGC, Pakistan State Oil, Pakistan Telecommunication ComApaAny, and National Bank of Pakistan closed green as investors anticipated buying by the proposed stock market support fund.
Mixed sentiment was seen in cements where Lucky Cement was up 0.5pc and D.G. Khan Cement 0.7pc closed in the green zone while Cherat Cement Company down 4.5pc closed near limit down.
Volumes increased significantly from 90 million shares to 166m shares (up 83pc day-on-day). Similarly, traded value also doubled from $21m to $41m.
Among the participants, mutual funds led the selling and disposed of shares worth $6.01m. Foreigners remained side-lined while the mutual funds sell off were absorbed by individuals who bought shares of the value of $4.34m.