Stocks fall for third day as economic outlook grows grimmer

By our correspondent

Stocks bled for the third straight day on Thursday as investors spent the day milling about on the sidelines fretting over country’s economic outlook that continues to remain bleak amidmore dismal growth forecasts, dealers said. Salman Ahmad, Director Equity Sales at Aba Ali Habib, said Moody’s report highlighted the ground reality, moreover, the gas shortage issue also made the dents. “Still there has been no clarity on when the countrywill receive fresh financial assistance from brotherly countries and the talks will resume with the IMF,” Ahmad said. Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index lost 0.77 percent or 295.81 points to close at 38,011.63 points level. KSE-30 shares index followed suitwith a loss of 0.88 percent or 161.00 points to end at 18,090.05 points level. Of 351 active scrips, 98 moved up, 228 retreated, and 25 remained unchanged. The readymarket volumes stood at 84.248 million shares, as compared with the turnover of 145.627 billion shares in the previous session. Analyst Ahsan Mehanti from Arif Habib Corporations said stocks closed bearish amid thin trade on investor concerns over weak earnings’ outlook, while uncertainty remained over fate of International Monetary Fund (IMF) bailout package and pending circular debt crises. “Falling global crude prices, dismal data in auto sales, home remittances and exports for November 2018 and ongoing foreign outflows catalysed a bearish close,” Mehanti added. Fitch in a report said the rupee would weaken further by December 2019 and (Pakistan) had to take bitter pills to get financial assistance from the IMF, addressing core issues like reforms in the power sector. Meanwhile, Moody’s forecast a growth of 4.2 percent to 4.7 percent in current fiscal year from 5.8 percent in FY18. It means growth would lower because of measures taken to check external imbalances. Exploration companies faced most of the burnt during the session because the latest data showed the gas production recorded a decline of 3 percent to 3.49 billion cubic per day. Mari Petroleum suffered a fall of Rs10.38/share, OGDC went down by Rs1.52/share, Pakistan Oilfields down by Rs10.71 and Pakistan Petroleum by Rs3.55. An analyst from Arif Habib Limited said index slipped again on the negative news flow that affected investor sentiment. “Retail investors largely stayed aside and otherwise took small positions,which was quite evident from the thin volumes even in small caps,” the analyst said. He added that index slid significantly due to blue chip Banks (HBL, UBL), Cement, Steel and E&P sectors. Adil Ghaffar, CEO at First Equity Modaraba, said low volumes clearly reflected lack of investor's interests. “Good yields are available in other sources such as banking and forex hedging stocks,” Ghaffar said. The highest gainers were Archroma Pakistan, up Rs27.62 to close at Rs580.07/share, and Shezan International, up Rs24.74 to finish at Rs519.74/share. Companies that booked highest losses were Sanofi-Aventis, down Rs39.66 to close at Rs753.67/share, and Bata Pakistan, down Rs39.58 to close at Rs1528.42/share. DGKC recorded the highest volumes with a turnover of 1.969 million shares. The scrip gained Rs0.01 to close at Rs87.67/share. The lowest volumes were witnessed in TRG Pakistan Limited, recording a turnover of 5.848 billion shares, and losing Rs0.8 to end at Rs23.89/share.