Market watch: Stocks fall as Pakistan stays in FATF grey list

Benchmark KSE-100 index sheds 243.04 points to settle at 45,578.36

KARACHI:

After posting gains for two consecutive sessions, the Pakistan Stock Exchange succumbed to selling pressure on Friday as investors resorted to panic selling after the Financial Action Task Force (FATF) kept Pakistan in its grey list.

Investors had expected a positive outcome from FATF’s meeting on Thursday. Although the global watchdog for financial crimes ruled out the possibility of blacklisting the country as it had implemented most of the action plan, market sentiment took a hit due to keeping the country in the grey list for an additional four months till February 2022.

Bulls opted to stay on the sidelines over speculation of potential delay in resumption of International Monetary Fund’s (IMF) $6 billion loan programme.

Moreover, slight weakening of the rupee against the greenback during the day further spread pessimism and marred the trading environment.

Index heavyweight sectors including fertiliser, automobile, chemical and bank faced stock selling by investors as they closed in the negative zone.

The first half of Friday’s session began on a positive note, however, the market dipped soon afterwards, weighed down by FATF’s decision on Pakistan. The market staged a partial recovery towards the end, closing the first half with a loss of 332 points.

The KSE-100 index remained range bound in the second half but a late session rally helped it recoup some of the losses.

At close, the benchmark KSE-100 index recorded a decrease of 243.04 points, or 0.53%, to settle at 45,578.36.

JS Global analyst Neelam Naz said that the KSE-100 index made a correction from the intra-day low of -641 points and managed to close at 45,578, down 243 points.

Negative contributors to the index were TRG Pakistan, Engro Corporation, Pakistan Petroleum and Pakistan State Oil.

 “Going forward, next week the market can continue its upward journey after completing its correction soon, therefore, investors are advised to view any dips as a buying opportunity mainly in blue-chip stocks,” the analyst said.

Overall trading volumes decreased to 300.7 million shares compared with Thursday’s tally of 338.3 million. The value of shares traded during the day was Rs11.8 billion.

Shares of 346 companies were traded. At the end of the day, 129 stocks closed higher, 208 declined and nine remained unchanged.

Hum Network was the volume leader with 35.9 million shares, gaining Rs0.12 to close at Rs6.67. It was followed by Unity Foods with 22.5 million shares, losing Rs0.48 to close at Rs29.31 and WorldCall Telecom with 21.1 million shares, losing Rs0.06 to close at Rs2.37.

Foreign institutional investors were net sellers of Rs281.8 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.