Extensive profit-taking drags PSX down
PHOTO: FILE
Pakistan Stock Exchange (PSX) on Thursday experienced yet another wave of volatility during which the KSE-100 index dipped around 1,500 points, driven by extensive profit-taking.
The index oscillated throughout the session and rose to the intra-day high of 114,329.95 points. However, a sharp sell-off in final hours pushed it down to the intra-day low of 112,594.66.
Broad-based declines were observed across key sectors including automobile manufacturers, cement, commercial banks, oil and gas exploration companies, oil marketing companies (OMCs) and power generation firms, reflecting a widespread market retreat.
Arif Habib Corp MD Ahsan Mehanti wrote that pressure was witnessed at the PSX amid concerns over the outcome of talks between the government and Pakistan Tehreek-e-Insaf, and the bar on non-filing PSX investors under new tax amendments.
"Political uncertainty, concerns over cautious monetary policy easing and uncertainty about the outcome of slippages in the IMF's tax targets played the role of catalysts in bearish activity," he added.
At the end of trading, the benchmark KSE-100 index posted a substantial decline of 1,510.19 points, or 1.32%, and settled at 112,638.26.
Topline Securities, in its review, commented that the market experienced notable volatility, reaching the peak of 114,330 and low of 112,595, which reflected uncertainty in cement and gas sectors.
The drop in the index was mainly driven by Engro Holdings, Mari Petroleum, Meezan Bank, Lucky Cement and Engro Fertilisers, which collectively wiped off 615 points, Topline added.
Arif Habib Limited (AHL) reported that another big decline kept the KSE-100 index locked in the 111,000118,000 trading range.
Some 22 stocks rose, while 76 fell with JDW Sugar Mills (+10%), Habib Bank Limited (+0.64%) and Pakgen Power (+4.07%) contributing the most to index gains. Engro Holdings (-6.69%), Mari Petroleum (-2.33%) and Meezan Bank (-2.68%) were the biggest drags, it said.
Cement dispatches for December 2024 saw a 2% year-on-year increase to 4.2 million tons compared to 4.1 million tons in the same month of the previous year.
According to AHL, the key level for January remains 115,000-115,500 and heading into the last session of the week, the KSE-100 is down 4.2% week-on-week.
JS Global analyst Muhammad Hasan Ather observed that the KSE-100 index dropped 1.3% day-on-day, driven mainly by noise on the political front and profit-taking by major institutional investors like insurance companies and banks.
Additionally, structural challenges, including the new tax amendments barring non-filers from market participation, contributed to the downturn, he said.
Insight Securities' Ali Najib commented that it was a fourth consecutive negative session on Thursday, when the market was seemingly under the full control of bearish forces. The KSE-100 plunged 1,510 points.
He said that investor sentiment crumbled as they aggressively trimmed their positions, which compelled the benchmark index to forego 114k and 113k levels.
Rising uncertainty on the political landscape, absence of positive triggers and continuous foreign selling could be attributed to the market behaviour, Najib added.
Overall trading volumes decreased to 695.1 million shares against Wednesday's tally of 1.1 billion. Shares of 454 companies were traded. Of these, 89 stocks closed higher, 321 slid and 44 remained unchanged.
WorldCall Telecom was the volume leader with trading in 195.3 million shares, remaining unchanged at Rs1.79. It was followed by K-Electric with 48.7 million shares, losing Rs0.1 to close at Rs4.76 and Cnergyico PK with 35.5 million shares, losing Rs0.31 to close at Rs6.69.
Foreign investors sold shares worth Rs806.7 million, the NCCPL reported.