Benchmark index falls 0.82% to settle at 34,119.39. PHOTO: AFP
Late on Wednesday, yields on treasury bills and 10-year Pakistan Investment Bonds (PIBs) rose notably, which dashed hopes for a further cut in the policy rate.
During the trading session, the international crude oil prices fell due to which oil-sector stocks in the local bourse came under pressure. Almost all of these stocks closed with a loss.
In addition to that, the budget for 2020-21, to be announced next week, remained shrouded in mystery, which weighed on investors’ mind and they resorted to profit-booking.
Following a mere gain of nine points at the start of trading, bears took control of the bourse that fell for the rest of the session.
In early hours, a few attempts were made by market participants to recoup the losses but all efforts went in vain as the index remained in the negative territory for the rest of the session. The decline of the index deepened in final hours.
At close, the benchmark KSE-100 index recorded a decrease of 282.03 points, or 0.82%, to settle at 34,119.39.
Arif Habib Limited, in its report, stated that the market saw selling pressure where exploration and production and banking sectors contributed to the decline, besides other sectors, which had been already adjusting downwards for the past couple of sessions such as cement, fertiliser, oil and gas marketing and pharmaceutical.
Overall, the benchmark index slid 311 points during the session after posting a small gain of nine points early on. It closed the day down by 282 points.
Yields on T-bills and 10-year PIBs increased significantly, which diminished prospects of a further policy rate cut.
At the same time, lacklustre participation from mutual funds, banks and insurance companies (mostly on the selling side) made current index levels a hurdle, just ahead of the budget.
International crude prices were under pressure, which brought exploration and production stocks down.
The technology sector topped the volumes with trading in 18.1 million shares, followed by power companies (15.8 million) and oil and gas marketing firms (13.6 million).
JS Global analyst Danish Ladhani said the benchmark KSE-100 index closed on a bearish note, shedding 282 points and closing at 34,119.
The market remained under pressure as profit-taking emerged amidst a lack of clarity on the budget announcement due in the coming week.
Profit-taking was noted in the exploration and production sector where Pakistan Oilfields (-1.7%), Pakistan Petroleum (-2%) and Oil and Gas Development Company (-2.1%) closed in the negative trajectory.
In the cement sector, Lucky Cement (-0.9%) was the major laggard. Furthermore, Engro (-0.4%), Hubco (-1.9%), Oil and Gas Development Company (-2.1%), Hubco (-1.9%), MCB (-1.8%), Pakistan Petroleum (-2%), Lucky Cement (-0.9%), UBL (-2%) and Pakistan Oilfields (-1.7%) were the index-movers.
The traded value stood slightly low at $34 million, down 19% while volumes improved 11% to 144 million shares.
“Going forward, we expect the market to remain under pressure and recommend investors to sell on strength ahead of the budget announcement,” the analyst said.
Overall, trading volumes increased to 143.6 million shares compared with Wednesday’s tally of 130 million. The value of shares traded during the day was Rs5.6 billion.
Shares of 341 companies were traded. At the end of the day, 93 stocks closed higher, 223 declined and 25 remained unchanged.
TRG Pakistan was the volume leader with 11.32 million shares, losing Rs0.82 to close at Rs27.18. It was followed by Unity Foods with 11.31 million shares, losing Rs0.21 to close at Rs12.8 and Hascol Petroleum with 8.1 million shares, losing Rs0.22 to close at Rs14.34.
Foreign institutional investors were net sellers of Rs160.7 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.
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