The Pakistan Stock Exchange on Friday experienced a roller-coaster ride, as investors were sceptical following a bloodbath at the bourse a day earlier, when it slumped over 2,000 points.
Bulls and bears were seen locking horns throughout the day and the benchmark KSE-100 index oscillated between red and green territories. It closed the day with just a single-point loss.
A fresh slump in the rupee’s value against the US dollar coupled with ballooning imports and widening trade deficit haunted the trading environment.
Rampant foreign selling in the past few sessions and uncertainty about the resumption of International Monetary Fund (IMF) loan programme dented the confidence of investors, who resorted to offloading their holdings.
Moreover, speculation about further monetary tightening by the State Bank of Pakistan (SBP) in the upcoming policy announcement on December 14 kept the overall mood depressed at the bourse.
On the flip side, Thursday’s carnage gave market participants an opportunity to cherry-pick stocks at attractive valuations.
The first half of Friday’s session kicked off with a steep fall as investors decided to book profit owing to a number of negative triggers. However, a buying spree helped the index recover partially by the end of first half.
The second half began on a bullish note but looming uncertainty erased all gains and pulled the market into negative zone. Cherry-picking in the final hour helped the bourse to end trading on a flat note.
At close, the benchmark KSE-100 index recorded a decrease of 1.32 points to settle at 43,232.83.
A report of Arif Habib Limited stated that bears ruled on Friday due to concerns over the current account deficit, depreciation of Pakistani rupee and a big jump in cut-off yields on treasury bills, which indicated a hawkish stance in the upcoming monetary policy statement.
On Thursday, the market saw a sharp fall due to sell-off by mutual funds, which eventually created an attractive opportunity for value hunters.
The market opened on a positive note as value hunters made aggressive buying in the first half, the report said. In the latter half, across-the-board selling was witnessed as the rupee closed at an all-time low of 176.77, down 0.2% day-on-day.
“Moving forward, we expect the market to remain volatile and recommend a cautious approach,” the report said.
Sectors contributing to the performance included cement (-180 points), technology (-63 points), engineering (-35 points), textile composite (-31 points) and refineries (-25 points).
Overall trading volumes declined to 287.7 million shares compared with Thursday’s tally of 386.8 million. The value of shares traded during the day was Rs10.3 billion.
Shares of 330 companies were traded. At the end of the day, 115 stocks closed higher, 205 declined and 10 remained unchanged.
WorldCall Telecom was the volume leader with 24.4 million shares, gaining Rs0.04 to close at Rs2.05. It was followed by TPL Properties XB with 20.6 million shares, losing Rs2.43 to close at Rs37.79 and Byco Petroleum with 16.96 million shares, losing Rs0.16 to close at Rs5.79.
Foreign institutional investors were net sellers of Rs225.5 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.
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