PSX sheds 610 points in cautious trading

Uncertainty about ME peace negotiations fuels stock offloading

KARACHI:

Investors offloaded their holdings at the Pakistan Stock Exchange (PSX) on Monday over uncertainty surrounding US-Iran negotiations for a peace deal, which pulled the KSE-100 index down by 610 points.

In the morning, trading commenced on a negative note, with the benchmark index sliding 1,433.57 points, or 0.84%, within minutes to hit 169,682.25 at 9:34 am. Selling was witnessed in key sectors including cement, commercial banks, oil and gas exploration, oil marketing and power generation, which kept the market under pressure during early hours.

The bourse briefly entered positive territory around midday, supported by value buying and improved sentiment. However, stock selling in heavyweight sectors erased gains, dragging the index back into the red.

At close, the KSE-100 recorded a dip of 609.51 points, or 0.36%, to 170,506.31 amid volatile trading as investors remained cautious over geopolitical developments and profit-taking.

Ismail Iqbal Securities, in its daily roundup, observed that the benchmark index closed lower in a volatile session after briefly trading in positive territory. Investors turned cautious amid an uncertain geopolitical environment, pushing the KSE-100 down by 610 points at close. Banking, cement and pharma sectors were the major laggards, cumulatively shedding 758 points, the report said.

The KSE-100 experienced a mixed and range-bound session as investors stayed cautious amid ongoing geopolitical uncertainty. Despite the decline, volumes on the benchmark index remained healthy at 634 million shares, highlighting speculative activity in selective names, said KTrade Securities' equity trader Ahmed Sheraz.

Globally, oil prices surged towards $106 per barrel overnight before easing back near $104 during market hours, which helped stabilise sentiment and averted aggressive selling. Activity remained concentrated in sideboard plays, while TRG was a key outperformer, hitting its upper cap following court's judgement to hold elections.

Sector-wise, technology and selective food names provided support, while commercial banks came under pressure. K-Electric, TRG and Pakistan Petroleum added points, whereas UBL, Engro Holdings and Meezan Bank weighed on market's performance. Going ahead, Sheraz expected the market to remain headline-driven and range bound, with investor focus centred on US-Iran talks-related developments and the upcoming diplomatic discussions involving Washington and Beijing.

According to Topline Securities, the benchmark index endured a volatile and range-bound trading session as investor sentiment turned fragile over the absence of any concrete progress in ongoing US-Iran negotiations and persistent uncertainty. In intra-day fluctuations, the index fell to the low of 1,532 points before staging a partial recovery.

Despite the rebound, the KSE-100 registered a decline of 610 points, or 0.36%, compared to the previous session. Index-heavy stocks such as UBL, Lucky Cement, Engro Holdings, Meezan Bank and NBP collectively dragged the index down by 667 points, Topline wrote.

In a similar note, Arif Habib Limited (AHL) analyst Ali Najib said that the PSX witnessed a range-bound session, with the KSE-100 closing at 170,506, down 610 points (-0.36%). Momentum stayed subdued due to geopolitical worries as aggressive rhetoric from both the US and Iranian officials heightened concerns over further escalation in the region.

On the economic front, remittances from overseas Pakistanis rose 11% to $3.5 billion in April versus $3.2 billion last year, though they declined 8% month-on-month. Going forward, the US-Iran developments would remain a key catalyst for market direction, Najib added.

Overall trading volumes increased to 1.10 billion shares compared with Friday's tally of 1.03 billion. The value of shares traded during the day stood at Rs31 billion.

Shares of 488 companies were traded. Of these, 234 stocks rose, 215 fell and 39 remained unchanged.

K-Electric was the volume leader with trading in 376.8 million shares, gaining Rs0.83 to close at Rs8.95. Foreign investors bought shares worth Rs135.9 million, the National Clearing Company reported.