Stocks tumble 644 points as Moody’s downgrades Pakistan’s outlook

Benchmark index loses 1.50% to finish trading at 42,358.61

KARACHI: Stocks plummeted another 700 points in intra-day trading on Thursday, with the index witnessing relentless selling pressure and finishing deep in the red.

The KSE-100 Index plunged from the word 'go' as investors reacted to news that Moody's has downgraded the outlook on Pakistan's rating to negative from stable. The index was further aggravated by the surging current account deficit and decreasing foreign direct investment.

In addition, continued foreign selling also contributed to the negative trend. Rupee's sharp devaluation against the US dollar also led to selling pressure in various sectors. Owing to the poor economic situation, investors resorted to book profits, with selling witnessed in stocks across the board.



At close, the benchmark KSE 100-share Index recorded a plunge of 644.23 points or 1.50% to settle at 42,358.61.

Elixir Securities' analyst Muhammad Arbash said that market opened negative and continued its slide throughout the day, marking an intra-day low of 706 points.

"The pressure continued from previous session where investors remained wary of foreign selling and continued deterioration in macro-economic outlook, while Moody's report added to concerns as the rating agency downgraded Pakistan's outlook," the analyst remarked.

All major sectors came under pressure with HBL (PA -3.14%), UBL (PA -3.16%), POL (PA -1.38%), PPL (PA -1.77%), LUCK (PA -1.23%) and PSO (PA -2.03%) being the most notable laggards.

"[We] expect market to remain dull with any positive development regarding the amnesty scheme being the only near term trigger in sight."



Overall, trading volumes increased to 241.7 million shares compared with Wednesday's tally of 136.4 million. The value of shares traded during the day was Rs9.3 billion.

Shares of 345 companies were traded. At the end of the day, 56 stocks closed higher, 276 declined while 13 remained unchanged.

K-Electric was the volume leader with 48.3 million shares, losing Rs0.14 to close at Rs5.50. It was followed by Summit Bank with 22 million shares, losing Rs0.03 to close at Rs2.18 and Pakistan Intl Bulk Terminal with 16.4 million shares, gaining Rs0.99 to close at Rs11.98.