KARACHI: Active short covering in some selective stocks helped Karachi bourse regain almost half of the day steep losses, but it has fallen close to 14,000 points at the psychological level during the second session on Friday.

KSE 100-share index finally declined by another 160 points or 1.11 per cent to close at 14,229 points, while repairing to the 12-week lowest level.

The parallel running junior 30-index also declined by another 284 points or 1.67 per cent and concluded at 16,768 points.

“Continuous foreign capital flight from local bourses never allowed stocks to get strengthened despite notable recovery witnessed in closing hours. Moreover, depreciating rupee value in parity with US dollar and other major currencies also urged investors to offload a part of their holdings,” analysts observed.

Foreign Portfolio Investors (FPIs) have withdrawn another Rs1.9 billion from the local equity market during the last two-day (i.e. May 08 & 09). Moreover, they (FPIs) have disinvested over Rs7.9 billion during the last two-week (since April 28, 2008 to date).

This continuous massive outflow of foreign funds convinced investors to sell out part of their holdings at the available margins, analysts said. During the day, the rupee remained under a heavy pressure in parity with US dollar and touched very close to Rs70 per US dollar. This inflationary trend in the rupee value prompted them (investors) to remain on the sidelines of the trading floors and those who were actively preferred to square their positions, they added.

The market opened on nerves note and remained uncertain amid range-bound throughout first two sessions of the day. Second session resumed trading with same depressed sentiments, and invited panic selling on across the board.

Therefore, index fell to 14,048 points intra-day low by shedding 399 points from intra-day high of 14,447 points hit in the beginning of second session as well. All the blue chips settled in red region except for Lucky Cement and National Bank. Oil and Gas Development Company and MCB Bank were two biggest contributors of points in minus in 100-index. These two scrips respectively shed 34 points and 25 points in minus in 100-index.

The other bigger (double digit) decliners on the board consist of Pakistan Telecommunication Company, Habib Bank and JS Co.

Hasnain Asghar Ali at Aziz Fidahusein said the value buying failed to get momentum despite rallying oil in the international market. The loss of investors’ confidence mainly due to sliding value of the local currency, constant outflow of foreign funds, thereby, never allowed the local players to get a firm grip.

S Kashif Mustafa at ECL Research said E&P sector showed a depressed performance, as all scrips closed in the red zone with high losses.

Cement sector posted a robust growth in export and taking an advantage of rupee, LUCK remained in the limelight after depreciating in last few trading sessions, DGKC was in the volume leaders, but at the end it closed in the red zone.

Therefore, the day turnover in the ready market again fell to 180.6 million shares as compared to 198.567 million shares changed hands a day earlier. The overall market capitalisation also declined by another Rs47 billion to Rs4.365 trillion.

The minus sign remained heavily dominated on the board with 197 stocks declined against 99 stocks advanced, the value of 25 scrips remained unchanged with total 321 active counters in the broader market.

Arif Habib Securities, OGDC, DG Khan Cement, Lucky Cement, Nishat Mills, Engro Chemical, Pak Oilfields, Attock Refinery, MCB Bank and National Bank were the top ten volume leaders of the day.