Stocks fall as economic uncertainty persists

Stocks closed negative on Wednesday as selling accelerated in cement, financial, auto and oil sectors amid economic uncertainty due to unattended budget proposals on tariff rationalisation and fast depleting foreign exchange reserves, dealers said.

Saad bin Ahmed, head of equity at Arif Habib Ltd said the outgoing government's actions missed some revenue generating measures, and it appears that the steps taken would burden the new government.

“Several measures taken (in) the federal budget appear to be quite unrealistic, and the approach showed that it has been done to benefit some circles,” he added.

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index shed 0.64 percent or 292.49 points to close at 45,196.37 points.

KSE-30 shares index shed 0.72 percent or 161.24 points to close at 22,233.60 points. As many as 371 scrips were active of which 120 advanced and 230 declined, whereas 21 remained unchanged.

The ready market volumes stood at 131.211 million shares as compared with the turnover of 248.565 million shares a day earlier.

Analyst Ahsan Mehanti at Arif Habib Corporation said rise in National Savings Scheme rates invited pressure in banking stocks.

“FED raise on cement sector and fall in PSDP allocations, concerns for pending circular debt, and $12 billion current account deficit of over 5.8 percent played a catalytic role in the bearish close,” the analyst added.

The market remained under pressure amid suppressed volumes. A downward trend was witnessed in food and fertiliser sectors as water shortage exceeded critical levels at Tarbela Dam, hitting dead level for the second time in a fortnight, which could directly pose a threat to summer crop harvesting in Sindh and Balochistan, analysts said.

Companies with the highest gains included Colgate Palmolive, up by Rs148.30 to close at Rs3,114.30/share, and Island Textile, up Rs51.96 to close at Rs1,091.20/share.

Companies showing the most losses were Rafhan Maize, down Rs150.00 to close at Rs7,750.00/share, and Pakistan Tobacco, down Rs111.00 to close at Rs2,235.00/share.

Highest volumes were witnessed in Lotte Chemical with a turnover of 15.132 million shares. The scrip gained 39 paisa to close at Rs11.66/share. It was followed by Bank Al-Falah with a turnover of 10.822 million shares. Its scrip gained 11 paisa to close at Rs51.98/share.

Lowest volumes were witnessed in Bank of Punjab with a turnover of 14.387 million shares. Its scrip fell 25 paisa and closed at Rs12.21/share.