Stocks closed down on Thursday as blue-chip fertiliser shares came under intense selling pressure on reports that the Economic Coordination Committee (ECC) may collect Rs10 billion subsidies from the fertiliser companies, dealers said.
Topline Securities noted that the fertiliser sector dented the benchmark KSE-100 shares index by 196 points “after the ECC’s comment to collect Rs10 billion windfalls from the fertiliser industry”.
“ECC also depicted displeasure over recent surge of Rs200/bag in urea prices, reported by news agencies. As a result investors’ confidence shattered and dragged the stock market to close at 41,863 points level, losing 386 points,” it noted.
Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index fell 0.91 percent or 385.92 points to close at 41,863.52 points. KSE-30 shares index lost 1.21 percent or 252.53 points to end at 20,608.68 points.
As many as 367 scrips were active in the session, of which 114 moved up, 234 retreated, and 19 remained unchanged. The ready market volumes stood at 191.518 billion shares as compared with the turnover of 134.791 billion shares in the previous session.
Analyst Ahsan Mehanti from Arif Habib Corporations said, “Panic selling was witnessed at PSX on dismal economic outlook, ECC discussions on circular debt surging to Rs1.1 trillion, and unresolved gas tariff issues.”
Concerns for foreign outflows and Nepra approval on raise in the tariff of Discos played a catalytic role in the bearish close, Mehanti added.
Engro Corporation down Rs11.58, Fauji Fertilizer down Rs3.68, Engro Fertilizer down Rs2.79, and Fatima Fertilizer down Rs1.50, made heavy dents at the overall performance of the stock market.
“The sector showed red signs owing to Wednesday’s discussion held during the ECC meeting, that the previous government’s incorrect decision to give heavy subsidy on exports of fertiliser might lodge claims of Rs10 billion on the companies,” an analyst said.
The highest gainers were Colgate Palmolive, up Rs145.00 to close at Rs3,045.00/share, and Pakistan Tobacco, up Rs112.09 to finish at Rs2,353.89/share.
Companies that booked highest losses were Unilever Foods, down Rs250.00 to close at Rs7,300.00/share, and Nestle Pakistan, down Rs80.00 to close at Rs10,480.00/share.
Lotte Chemical recorded the highest volumes with a turnover of 11.403 million shares.
The scrip gained Rs0.11 to close at Rs14.68/share, followed by National Bank with a turnover of 7.124 million shares, as the bank’s scrip gained Rs0.81 to close at Rs52.14/share.
The lowest volumes were witnessed in Engro Polymer, recording a turnover of 9.610 million shares. The scrip lost Rs0.35 to end at Rs34.43/share.