Another disaster was seen in the market whereby the market nose-dived 92.95 points and closed at 8316.21 against 8409.16 of Monday although in early hours, the market had moved towards its intra-day high at 8486.76 level.
Tariq Hussain Khan, research analyst at Atlas Investment Bank, said that banking, cement, oil and gas sectors were in the positive territories due to renewed interest by small investors. All of a sudden, the market started melting down as selling pressure in BOP and OGDC created panic among investors.
All major stocks showed lacklustre performance, causing a huge trading range. However, trading volumes jumped to 288 million shares, up by 20 percent. OGDC and NBP contributed 47 and 17 points, respectively, to the index.
Losers outnumbered the gainers as 149 stocks remained in negative while 106 companies went up.
"We expect the market may continue its negative trend as investors'' confidence has been shattered despite better-than-expected corporate earnings", Tariq said.
Initially the market opened on a positive note and made 77 points high, supported by the fact that no CFS transactions were to take place on Tuesday. Nonetheless, weak sentiment made the index plunge nearly 200 points intra-day to the 8210-point level.
The session was the sixth consecutive one with the market showing 100 points plus movements with enormous volatility, said Tanvir Abid, head of research at Live Securities. Banking sector scrips were primarily responsible for moving the market in the negative zone. MCB was up by Rs 2.55 while the rest of the banks, like NBP, FABL and BAFL, closed in the negative territory with BoP closing limit-down.
PTCL was the volume leader with 33 million shares posting a decline at Rs 0.25. On the other hand, cement stocks were in the positive zone, except Fauji that declined 0.3 percent. D G Khan Cement and Maple Leaf Cement soared 3.7 percent and 2.6 percent, respectively, while Lucky closed at its upper circuit level. Most of energy scrips were under pressure, with POL, PPL and OGDC, respectively declining 2.4 percent, 1.0 percent and 2.5 percent.
On the other hand, PSO soared to Rs 413.55 on upbeat quarterly earnings expectations. The superb financial results of Shell announced early in the day also supported the oil marketing giant''s valuations. The trend of the market was highly unstable.
"We recommend that investors remain on the sidelines, given that only two days remain for the expiry of the October futures contracts and the forthcoming holiday season."
Abbas Raza from First Capital Equities said that benchmark-100 was under the grip of selective stock buying, of which Lucky, PSO, MCB and APL were purchased with good volumes, while parking Lucky on it upper circuit of Rs 71.95.
"The bourse with all its selectivity and upward opening momentum has not voided the market of extreme volatility which without any doubt would persist in the coming sessions, and the closure of KSE-100 below the 21-day average of 8507.99 the market looks weak and seems highly unlikely that it would be able sustain an up-trend due to the inherent weakness of the bourse. This is contrary to any positive news, like Etisalat''s payment, that could become a base for a good rally. Until then, extreme caution is advised."