Saturday, December 20, 2008

Karachi Stocks end 18 per cent lower for week

KARACHI: Pakistani shares fell to end at an almost three-and-a-half year low on Friday, taking the loss for the week to 18 per cent since a floor on the main index was removed.
The Karachi Stock Exchange 100-index fell 3.48 per cent, or 270.84 points, to end at 7,514.42 points, its lowest close since Aug. 24, 2005.
Turnover was 32.7 million shares and dealers said most trade was in third-tier shares with almost none in heavyweights.
‘Until now we have not seen any investor interest in blue-chips,’ said Sajid Bhanji, a dealer at brokers Arif Habib Ltd.
Dealers also said shares traded off-market were still 30 per cent lower than their official prices.
According to the latest data up to December 18, Engro Chemicals Ltd was being traded at 100 rupees a share, or 31.2 per cent lower than its official closing on Friday.
National Bank of Pakistan was traded at 45 rupees, or 40.6 per cent lower than its Friday close.
Dealers said a report this week of a support fund for the market did not help improve sentiment and they would believe the fund if and when it materialised.
The KSE management, including the Securities and Exchange Commission and the National Clearing Company of Pakistan Ltd, are facing cases filed by brokers seeking settlement of amounts borrowed through a continuous funding system, a funding mechanism for some stocks listed on the KSE.
In the currency market, the rupee ended at 79.45/55 to the dollar compared with 79.40/50 on Thursday and despite a decision by Standard & Poor’s Ratings Services to raise Pakistan’s sovereign ratings to CCC-plus from CCC.
A currency dealer said the ratings rise did not do much for the rupee, adding: ‘But it’s very important now to meet the IMF’s targets.’ Dealers said the outlook for the rupee was weak and even if imports decreased, they were expecting a slowdown in exports and overall economic growth, which would put pressure on the currency.

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