PSX: KSE-100 Index closes flat amid IPP concerns, rupee gains marginally

The KSE-100 Index ended nearly flat on Friday, as market sentiment fluctuated due to concerns over the early termination of contracts with independent power producers (IPPs). 

The session opened on a positive note with the KSE-100 hitting an intra-day high of 85,750.19 points. However, selling pressure soon followed, dragging the index down to an intra-day low of 84,774.46. Late-session buying helped the benchmark index recover slightly, closing at 85,483.40, up by just 30.18 points or 0.04%.

Market analysts at Topline Securities noted that negotiations with five IPPs for early termination of Power Purchase Agreements (PPAs) weighed on investor sentiment. Despite some gains, the market remained cautious as the developments unfolded.

Key contributors to the index's positive performance included PSO, FFC, EFERT, PIOC, and UBL, collectively adding 276 points. However, losses from HUBC, LUCK, HBL, TRG, and SRVI offset gains, dragging the index down by 327 points.

On the broader economic front, Pakistan's ability to repay the International Monetary Fund (IMF) remains under scrutiny. 

The IMF’s latest staff report highlighted significant risks to Pakistan’s repayment capacity, with the country's dependency on policy reforms and timely external financing. The Fund’s exposure to Pakistan is projected to reach SDR 6,816 million by September 2024, equivalent to 336% of the country’s quota.

In a bid to strengthen economic ties, Pakistan’s listed companies, such as Citi Pharma Limited and Pakistan Cables, announced joint ventures with Saudi firms. Citi Pharma entered into a collaboration with All Care Group of Investment to establish an advanced pharmaceutical manufacturing facility in Saudi Arabia.

Meanwhile, the Pakistani rupee ended marginally stronger against the US dollar, appreciating by 0.05% in the inter-bank market. The currency closed at 277.64, gaining Rs0.15 against the dollar.

Market volume increased to 560.74 million shares, compared to 503.75 million in the previous session. However, the total value of shares traded decreased to Rs26.12 billion from Rs27.91 billion.

Hub Power Co. led the trading volumes with 58.16 million shares, followed by PTCL with 51.35 million shares, and WorldCall Telecom with 45.7 million shares. Out of 435 companies traded, 130 registered an increase, 251 saw a decline, while 54 remained unchanged.