Stocks struggle as political fears grow

Stocks were range-bound on Monday as markets digested Sunday's by-polls in the country, while also looking ahead to an outcome from the finance minister's recent meetings with IMF officials.

The Pakistan Stock Exchange's (PSX) benchmark KSE 100-share Index closed down 193.05 points or 0.46 percent to close at 41,755.45 points. The highest index of the day remained at 41,988.97 points while the lowest level of the day was recorded at 41,726.75 points.

KSE-30 index also shed 109.46 points or 0.70 percent to close at 15,424.17 points Traded shares decreased by 184 million shares to 144.312 million shares from 328.653 million shares. The trading value fell to Rs4.667 billion from Rs9.611 billion. Market capital narrowed to Rs6.784 trillion from Rs6.818 trillion. Out of 348 companies active in the session, 127 closed in green, 205 in red and 16 remained unchanged.

Dealers said Analysts said falling rupee and a decline in the international equity market also affected market sentiment. Analyst Ahsan Mehanti at Arif Habib Corp said stocks witnessed bearish close on a slump in global equities and falling rupee.

"IMF restriction over energy subsidies, cautious activity ahead of FATF decision over exit from the grey list and concerns for ongoing political noise played a catalyst role in the bearish close," he said.

Analyst Muhammad Arbash at Topline Securities said after sideways opening, the market witnessed profit-taking as investors were concerned over uncertain political and economic conditions which led the market to make an intraday low of 222 points..

Major negative contributors in the trading session were TRG, OGDC and PPL which cumulatively dented the Index by 85 points. The highest increase was recorded in shares of Rafhan Maize, which rose by Rs700 to Rs11,000 per share, followed by Sanofi-Aventis, which increased by Rs57 to Rs1,185 per share. A significant decline was noted in shares of Sapphire Fiber, which fell by Rs76.52 to Rs1,259.38 per share, followed by Colgate Palm, which decreased by Rs46.80 to Rs2,039.50 per share.

Brokerage Arif Habib Ltd in a post-session report said the benchmark index closed in red after a start the day in the green due to political unrest. “The volumes declined dramatically in the main board; however, decent volumes were recorded in the 3rd tier stocks.”

Sectors contributing to the performance included E&P’s (-49.5 points), cement (-32.1 points), technology & communication (-15.2 points), commercial banks (-14.7 points) and chemical (-14.2 points).

WorldCall Telecom remained the volume leader with 18.042 million shares that fell by 4 paisas to Rs1.55 per share. It was followed by Dewan Cement with 6.786 million shares that closed lower by 4 paisas to Rs5.72 per share.

Other stocks that recorded significant turnover included Lotte Chemical, Hascol Petrol, TRG Pak Ltd, Cnergyico PK, Netsol Tech., Hum Network, Ghani Glo Hol and Unity Foods Ltd. Shares’ turnover in the future contracts decreased to 43.412 million shares from 90.840 million shares.