Stocks fall 1.5pc on geopolitics, rupee depreciation

Stocks fell over 1.5 percent on Thursday because of rising political tensions and jitters related to rupee depreciation, although trading volume shrank, suggesting there was less panic selling in the market, dealers said.

Analyst Ahsan Mehanti at Arif Habib Corp said stocks fell sharply lower amid concerns for prolonged political uncertainty in the country. “Panic selling was witnessed in scrips across the board after major fall in rupee value, while dismal data on trade deficit and weak global crude oil prices also played catalytic role in bearish close,” he said.

The Pakistan Stock Exchange's (PSX) benchmark KSE 100-share index closed fell 1.54 percent or 596.10 points to close at 38,223.55 points. The highest index of the day remained at 38,825.74 points while the lowest level of the day was recorded at 38,127.69 points. KSE-30 index also shed 342.42 points to close at 19,060.28 points.

Turnover also dropped 25 million shares to 92.94 million shares from 117.70 million shares. Trading value also decreased to Rs4.10 billion from Rs5.37 billion while market capital fell to Rs8.20 trillion from 8.30 trillion. Out of 347 companies’ active in the session, 59 closed in green, 269 in red while 19 remained unchanged.

Analyst Zain-ul-Abedin at Elixir Securities said equities turned back south with benchmark index plummeting with noise on politics pretty much to blame for the decline. “With key support lying around 37,500 level, we expect benchmark Index to consolidate and trade in a 800-1000 points in the near-term,” he added.

Market opened lower as stocks carried bearish momentum from the start and all major sectors including oils, financials, cements and steels remained in red throughout the trading session on extremely dull volumes.

Blue chips to the likes of Hub Power (down 2.6 percent), MCB Bank (down 1.6 percent), Pakistan State Oil (down 3.3 percent) and Engro Corp (down 1.7 percent) traded lower and dented the index, while DG Khan Cement (down 5.0 percent), International Steels Limited (down 4.9 percent) and Pak Electron (down 5.0 percent) were among the main culprits that kept sentiments down as they slid sharply towards their lower limits during the day.

Highest increase was recorded in shares of Rafhan Maize, which rose Rs299.98 to Rs6,799.98/share, followed by Colgate Palmolive that increased Rs60 to Rs2,590/share. Major decline was noted in shares of Wyeth Pak Ltd, which fell Rs54 to Rs1,405/share, followed by Sanofi-Aventis that decreased Rs48 to Rs1,241/share.

Significant turnover was recorded in stocks of TRG Pak Ltd, K-Electric Ltd, Pak Elektron, Dewan Cement, Dewan Motors, Aisha Steel Mill, WorldCall Telecom, Inter Steel Ltd, Sui Northern Gas Pipelines Ltd and Jahangir Siddiqui Co.

TRG Pak Ltd remained the volume leader with 10.30 million shares with a decrease of Rs1.59 to Rs30.22/share. It was followed by K-Electric Ltd with 8.34 million shares with a decline of 28 paisas to Rs6.10/share.  

Shares’ turnover in the future contracts dropped to 35.12 million shares from 36.72 million shares traded in the previous session.​