Stocks closed lower on Friday as investors remained concerned ahead of the monetary policy statement next week, where the market expects a 100-200bps increase in the discount rate, traders said.
Pakistan Stock Exchange (PSX) benchmark KSE 100-share Index shed 1.09 percent or 423.60 points to close at 38,407.98 points against 38,831.58 points recorded in the last session. Intraday high was 38,982.77 points, while intraday low was recorded at 38,291.70 points.
Arif Habib Ltd said the market opened in the green but bears rapidly took control, as investor participation was low because of uncertainty surrounding the talks to revive the IMF programme. “The second session began with the same negative sentiments, but due to the weekend investors booked profit that led the market to make an intraday low of 539.88 points.”
Volumes on the mainboard remained reasonable, with third-tier companies dominating the volume board.
KSE-30 index shed 1.23 percent or 176.82 points to stand at 14,222.78 points compared with 14,399.60 points recorded in the last session.
Volumes decreased by 64 million shares to 93.450 million shares from 157.822 million shares. Value dropped to Rs3.508 billion from Rs6.406 billion. Market capital narrowed to Rs6.134 trillion from Rs6.179 trillion. Out of 314 companies active in the session, 103 closed in green, 194 in red and 17 remained unchanged.
Analyst Nabeel Haroon at Topline Securities said the first half saw range-bound activity, whereas in the second half the market came under pressure to decline and close at 38,408 points. “This decline can be attributed to further increase in T-Bill and PIB yield in the secondary market ahead of the monetary policy announcement on Monday, where the market expects the policy rate to increase in the range of 100-200bps,” he said.
TRG, PSO, Lucky Cement, Bank al Habib and Engro Fertilizers lost value to bring the index down 147 points.
The highest increase was recorded in the shares of Bhanero Tex, up Rs82 to Rs1,177/share, followed by Nestle Pakistan, up Rs50 to Rs5,310/share. A significant decline was noted in the shares of Indus Motor, down Rs58.15 to Rs841.35/share, followed by Philip Morris Pak, down Rs35 to Rs530/share.
Analyst Ahsan Mehanti at Arif Habib Corp said, “Stocks fell across the board on uncertainty over SBP policy statement due next week amid high inflation and investor concerns over ongoing forex crises.”
He said rupee instability, dismal data on textile exports falling by 16.47 percent YoY in December 2022 and uncertainty over the outcome of Pak-IMF negotiations on programme conditions amid political uncertainty played a catalytic role in the bearish close.
Sectors contributing to the performance included commercial banks (-82.1 points), technology and communication (-60.8 points), cement (-58.8 points), E&P’s (-53.4 points), and OMCs (-41.0 points).
PRL remained the volume leader with 8.309 million shares. Its scrip shed Rs1.16 to end at Rs72.92/share. It was followed by WorldCall Telecom with 5.645 million shares that closed lower by two paisas to stand at Rs1.11/share.
Other stocks that recorded significant turnover included Ghani Chem (B), Cnergyico PK, TRG Pak Ltd, OGDC, K-Electric, Al Shaheer (R), PRL and Fauji Cement.
Turnover in the future contracts decreased to 38.277 million shares from 73.033 million shares.