KSE 100-index ends lower, rupee firms

KARACHI: Karachi Stock Exchange (KSE) ended more than 1.3 percent lower on Thursday, hit by a global market sell-off and by investors booking profits following a seven-week high the previous day, dealers said.

A grim outlook for the US economy from the Federal Reserve and signs of a slowing in China and Germany sent world stocks tumbling on Thursday, and drove investors into safer currencies and government bonds.

"Bearish activity was witnessed in stocks across the board after a major fall in global stocks and commodities on the US Fed statement warning a significant downside risk to the US economy and Moody's downgrade of three US banks," said Ahsan Mehanti, director at Arif Habib Investments.

The KSE benchmark 100-share index fell 1.36 percent or 161.75 points to end at 11,690.23.

Volume was 82.73 million shares, compared with 117.13 million shares traded on Wednesday.

In the currency market, the rupee firmed to 87.53/58 to the dollar, compared with the previous day's close of 87.72/78 to the dollar, amid lack of import payments.

The rupee hit a record low of 87.92 to the dollar on Friday and dealers expect the pressure to continue after reports Pakistan will not seek a new loan from International Monetary Fund.

Increases in import payments and a negative economic outlook will also continue to keep the local unit under pressure, dealers say.

In the money market, overnight rates rose to the top level of 13.40 percent, compared with Wednesday's close of between 11.0 percent and 11.15 percent as there were net scheduled outflows of around 40 billion rupees ($455.84 million).

Copyright Reuters, 2011