KARACHI: Pakistan Stock Exchange staged on Wednesday a handsome recovery from a plunge of around 900 points, but still finished trading with a loss of 300 points in the KSE-100 index.
Before the recovery, the bourse nosedived over 880 points as pessimism over the country’s economic situation persisted and no positive triggers emerged to drive the market up.
Investors were concerned over the failure of Pakistan Tehreek-e-Insaf (PTI) government to address the challenges faced by the beleaguered economy. The index remained on a downward trajectory, hitting an intra-day low of 38,719.62 points.
“The government has so far failed to take concrete measures to address some large issues like the runaway current account deficit and fiscal deficit. The poor state of the economy is reflecting at the stock exchange,” commented JS Global Head of Equity Sales Farhan Rizvi while talking to The Express Tribune.
“We are playing with fire,” he said, adding containing the fiscal and current account deficits was a must to put the economy back on track.
In the morning, trading activity began on a negative note and the market fell steadily till midday when it touched its lowest mark for the day. Later, aggressive buying dominated market proceedings and the index recovered nearly 500 points.
Index-heavy stocks including automobile, financial and cement stocks came under pressure and most of them closed in the red.
At the end of trading, the benchmark KSE 100-share Index recorded a decrease of 299.76 points or 0.76% to settle at 39,303.11.
Arif Habib Limited, in its report, stated the market plunged again with the index losing 883 points, which was largely caused by negative news about Chinese support for managing Pakistan’s balance of payments.
“Recovery seems to have taken place on the back of rumours making rounds that Finance Minister Asad Umar may be given the planning and development portfolio and he may be removed as finance minister,” it added.
“Besides, International Industries Limited issued a notification to the exchange, saying Sui Northern Gas Pipelines has given a procurement order that resulted in the (steel manufacturer’s) stock hitting the upper circuit.”
Buying activity was seen in cement, steel, bank and fertiliser sectors. The chemical sector saw larger volumes compared to cement and banking sectors, with most of the activity in Lotte Chemical.
Stocks that contributed positively included Dawood Hercules (+34 points), Sui Northern Gas Pipelines (+16 points) and International Steels (+12 points). Stocks that contributed negatively were Habib Bank (-33 points), Pakistan State Oil (-29 points) and United Bank Limited (-28 points).
Overall, trading volumes decreased to 138.1 million shares compared with Tuesday’s tally of 195.9 million. The value of shares traded during the day was Rs6.8 billion.
Shares of 358 companies were traded. At the end of the day, 103 stocks closed higher, 231 declined and 24 remained unchanged.
Lotte Chemical was the volume leader with 10.6 million shares, gaining Rs0.18 to close at Rs18.85. It was followed by The Bank of Punjab with 9.9 million shares, gaining Rs0.05 to close at Rs13.11 and Maple Leaf Cement with 8.1 million shares, losing Rs1.39 to close at Rs42.45.
Foreign institutional investors were net buyers of Rs219.2 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.