Stocks closed little changed on Wednesday as investors weighed the impact of the Morgan Stanley Capital International (MSCI) semi-annual index review that reduced the country’s weight in the frontier market index, dealers said
The Pakistan Stock Exchange benchmark KSE-100 index inched up 0.02 percent or 14.14 points to close at 56,680.07 points, after trading in a narrow range of 413.63 points. The index hit an intraday high of 56,846.68 points and a low of 56,433.05 points.
Market participants said the market was somewhat disappointed by the MSCI review, which deleted four companies from the MSCI Pakistan Index and lowered the country's weight in the MSCI Frontier Markets 100 Index from 3.2 percent to about 2.9 percent.
They said the trading activity remained high despite the lack of direction, with a record volume of 306.792 million shares and a value of Rs24.3 billion traded on the KSE-100 index.
"Stocks closed flat amid concerns for federal cabinet discussions on tax over windfall corporate earnings and MSCI decision to reduce weight in MSCI frontier market index," said analyst Ahsan Mehanti at brokerage Arif Habib Corp. Brokerage Topline Securities in its post-trading note said the equities observed mix price action during the session.
"The day commenced the business on a positive note but surrendered to selling headwinds just after opening in the backdrop of unexpected outcome of MSCI Equity Indexes November Review where Pakistan weight in MSCI Frontier Index got reduced by 24bps against the street expectation of some improvement in the aforesaid league," it added.
A Bloomberg report that Pakistan's ongoing review with the International Monetary Fund (IMF) could be concluded this week played a positive role in the market, as it could improve the country's access to other credit sources.
Oil and gas exploration and marketing companies, food and personal care products, refineries, and cable and electrical goods sectors supported the index, while power generation and distribution, banks, and automobile sectors dragged it down.
Pakistan State Oil Co Ltd, Oil and Gas Development Co Ltd, Pakistan Petroleum Ltd, Unity Foods Ltd, and Attock Refinery Ltd were the top contributors to the index, adding a combined 224.06 points.
Hub Power Co Ltd, Bank Al Habib Ltd, and Millat Tractors Ltd were the main laggards, shedding a total of 180.01 points. Worldcall Telecom Ltd was the most traded stock, with 70.2 million shares changing hands, followed by Byco Petroleum Pakistan Ltd and TRG Pakistan Ltd.
Of the 100 index companies, 40 closed higher, 38 closed lower, two remained unchanged, while 20 were not traded. The broader All-Share index gained 0.34 percent to close at 37,669.26 points, with 263,656 trades reported in 357 companies. Total market volume soared to 661.624 million shares, the highest since July 01, 2021.
