The Pakistan Stock Exchange nosedived on the first trading day of the week as sceptical investors preferred to stay on the sidelines before the announcement of the monetary policy late in the evening.
The benchmark KSE-100 index plunged by around 660 points as domestic political uncertainty amid deteriorating economic situation continued to take a toll on the investors’ interest.
Bearish sentiments prevailed in the market, where the benchmark index remained in the negative territory throughout the session to finally settle in the red zone.
Gloomy macroeconomic indicators amid continuously falling rupee value against the greenback kept the pressure at the local bourse, which was evident from the thin trading volume and value.
Earlier, the session commenced on a bleak note, as the benchmark KSE-100 index nosedived during the initial hours of the trading.
Moving forward, it remained in the negative territory and touched an intra-day low of 42,345 points during the second half of the day, as investors took a cautious approach ahead of the benchmark interest rate announcement.
However, a brief buying activity towards the end helped the index to recoup some of the losses, but eventually settle in the red zone.
At close, the benchmark KSE-100 index recorded a decrease of 660.46 points, or 1.53%, to settle at 42,440.25 points.
Topline Securities, in its report, said that Pakistan equities witnessed a bearish session ahead of the Monetary Policy Committee (MPC) meeting.
Investors opted to stay on the sidelines before the aforesaid announcement, “where street expectation is a 100 basis points increase in the benchmark interest rates”.
Initially, the market opened on a negative note and remained negative throughout the day, Topline said, adding that during the trading hours, benchmark index made an intra-day low by 756 points, but eventually settled at 42,440-point level.
Cement, technology, power, fertiliser and exploration and production sectors stocks contributed negatively to the index, where Lucky Cement, Systems Limited, Hub Power Company, Fauji Fertiliser Company and Oil and Gas Development Company lost 221 points cumulatively.
On the flip side, Murree Brewery Company, Habib Metropolitan Bank and Bank Alfalah Limited witnessed some buying interest as they added 8 points collectively, Topline added.
A report of Arif Habib Limited stated that the market witnessed a bloodbath session as investors remained bearish throughout the day.
The benchmark KSE-100 index nosedived from the beginning of the session as increase in political noise over the weekend and uncertainty regarding resumption of the IMF loan programme along with continued depreciation of the rupee against the US dollar and rumour of rate hike in the monetary policy, shattered investors’ confidence.
Volumes remained dull in the main board although hefty volumes were observed in third-tier stocks.
Sectors contributing to the performance included cement (-120.8 points), fertiliser (-89 points), exploration and production (-79.9 points), technology (-72.5 points) and banks (-63.1 points).
JS Global analyst Mubashir Anis Naviwala said that after remaining bearish for most of the trading session, the KSE-100 index ended the session with a loss of 660 points closing in at 42,440-level.
The market traded between the range of 43,100 and 42,345 levels. Major contributors to the volumes were Silk Bank Limited (3.1%), WorldCall Telecom (-5.7%), K-Electric (-3.1%), Ghani Global Holdings (-4.5%) and Cnergyico PK (-2.1%).
“Going forward, we recommend investors to remain cautious with the 150 basis points increase announced in the policy rate after market hours,” the analyst said.
Overall trading volumes declined to 118.98 million shares compared with Friday’s tally of 189.9 million. The value of shares traded during the day was Rs3.6 billion.
Shares of 314 companies were traded. At the end of the day, 48 stocks closed higher, 250 declined and 16 remained unchanged.
Silk Bank Limited was the volume leader with 9.97 million shares, gaining Rs0.04 to close at Rs1.32. It was followed by WorldCall Telecom with 7.6 million shares, losing Rs0.09 to close at Rs1.5 and K-Electric with 6.1 million shares, losing Rs0.08 to close at Rs2.5.
Foreign institutional investors were net sellers of Rs114 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.
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