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Tuesday March 19, 2024

Stocks fall 1.7pc on rocky economy, rising political uncertainty

By Our Correspondent
June 23, 2018

Stocks plunged 1.7 percent on Friday, ending the week with a cumulative 2,000 points decline in three sessions owing to foreign selling, poor economic indicators and rising political temperature, dealers said.

An analyst from Ismail Iqbal Securities said news of the finance minister meeting with the president of a consortium of financial advisors to arrange a syndicated loan for Pakistan could also not lift investor sentiments.

“We expect the market to remain negative in the upcoming session due to the instability of the rupee, and the upcoming FATF (Financial Action Task Force) meeting.

Investors should keep an eye on OPEC’s announcement later (on Friday),” the analyst added.

Pakistan Stock Exchange (PSX) KSE-100 shares index shed 1.70 percent or 721.23 points to close at 41,637.38 points. KSE-30 shares index lost 1.91 percent or 398.70 points to close at 20,489.58 points.

Of the 347 active scrips, 75 advanced and 257 declined, whereas 15 remained unchanged. The ready market volumes stood at 178.968 billion shares compared to a turnover of 241.681 billion shares in the previous session.

Hamad Aslam, research director at Elixir Securities said, “Investors remained sceptical of the deteriorating economic situation and lack of clarity on the IMF program. While foreign selling remained elevated during the day, there were also reports of margin calls in select retail favourite stocks.”

The benchmark KSE-100 index closed at 41,367 points, marking the lowest level since May 18, 2018, he added.

Analyst Ahsan Mehanti from Arif Habib Corporation said, “Speculations ahead of the FATF meeting next week and the dismal data on external account balances amid rising circular debt in the energy sector, which has reached $547 billion, played a catalytic role in the bearish close at the PSX.”

Authorities in Pakistan were making strict efforts to check money laundering and terror financing, which should convince the FATF members to not put the country on the grey list, dealers said.

The highest gainers were Colgate Palmolive, up Rs30.50 to close at Rs3,099.00/share, and Indus Dyeing, up Rs29.64 to finish at Rs623.64/share.

Companies that booked highest losses were Rafhan Maize, down Rs376.90 to close at Rs7,425.60/share, and Pakistan Tobacco, down Rs106.70 to close at Rs2,027.31/share.

Hino Pak Motor Limited recorded the highest volumes with a turnover of 1,340 shares, while the scrip gained Rs3.89 to close at Rs835/share.

The lowest volumes were witnessed in K-Electric Limited. It recorded a turnover of 20.260 million shares, with its scrip losing Rs0.18 to end at Rs5.32/share.