PSX plunges 2,475 points on peace talks delay

KSE-100 settles at 178,922 on fresh Lebanon hostilities; foreign investors offload Rs323m

KARACHI:

The Pakistan Stock Exchange (PSX) closed sharply lower on Friday as fading optimism over a potential Iran-US peace agreement and renewed regional tensions triggered widespread profit-taking. The benchmark KSE-100 index lost almost 2,500 points to settle at over 178,900, reversing part of Thursday's rally when hopes of easing geopolitical risks had lifted the market.

At the close of trading, the benchmark KSE-100 index posted a sharp decline of 2,475.46 points, or 1.36%, and settled at 178,922.76.

AHL observed that declines dominated trading at the PSX on Friday as the benchmark KSE-100 index fell by 2,475.5 points, or 1.36%, to close at 178,922.8, trimming its week-on-week gain to 3.78%. Market breadth remained negative, with only 18 stocks advancing while 82 declined. Despite the broader sell-off, Pakistan State Oil (PSX) contributed 31.5 points to the index with a gain of 3.78%, while Sui Northern Gas Pipelines (SNGP) added 25.6 points after rising 2.54%, and Sui Southern Gas Company (SSGC) contributed 8.1 points with a 2.25% increase. On the downside, United Bank Limited (UBL), Fauji Fertiliser Company (FFC) and Engro Holdings emerged as the biggest drags on the benchmark, shaving off 71.5, 58.8 and 49.9 points, respectively.

Market sentiment remained cautious amid geopolitical uncertainty. Investors reacted to reports that the United States and Iran had delayed the start of negotiations over a permanent peace agreement aimed at ending tensions in the region. The talks, which were scheduled to take place in Switzerland, were postponed after Iran declined to send a delegation following renewed hostilities in southern Lebanon. Meanwhile, investors also took note of progress on Pakistan's privatisation agenda after the Privatisation Commission approved a restructuring plan for Faisalabad Electric Supply Company (FESCO), a key step in the government's efforts to privatise power distribution companies.

Trading activity remained healthy, with total market volume reaching 1.05 billion shares and traded value standing at Rs54.1 billion ($194.6 million). The overall market capitalisation declined to Rs19.99 trillion. Analysts noted that the near-term support zone between 177,000 and 179,500 points held firm, aided by lower-on-decline printing around 177,800 points. This support range is expected to remain critical in the coming week, while the 183,000 level is being viewed as the next major upside target if buying interest returns.

Topline market review noted that the KSE-100 index traded in a narrow range during the early hours of trade; however, selling pressure was observed during the second half of the trading session.

The top negative contribution to the index came from UBL, FFC, ENGROH, PPL, OGDC, LUCK, HBL and SYS, as they weighed on the index by 1,273 points. Traded value-wise, HUBC (Rs3.2 billion), OGDC (Rs3.1 billion), PPL (Rs2.9 billion), SSGC (Rs2.8 billion) and SNGP (Rs2.6 billion) dominated the trading session. Traded volume and value for the day stood at 1 billion shares and Rs54 billion, respectively.

Overall trading volume was recorded at 1.05 billion shares compared with the previous session's tally of 1.24 billion. The value of shares traded during the day was Rs54.14 billion. Shares of 497 companies were traded. Of these, 141 stocks closed higher, 329 fell and 27 remained unchanged.

Sui South Gas was the volume leader with trading in 87.35 million shares, gaining Rs0.69 to close at Rs31.32. It was followed by Kohinoor Spinning with 80.62 million shares, losing Rs0.02 to close at Rs6.96, and TPL Corp Ltd with 47.05 million shares, losing Rs1.75 to close at Rs15.72.

Foreign investors sold shares worth Rs323 million, the National Clearing Company reported.