Index sheds 1.44 percent on political noise

The index on Monday lost 1.44 percent in a frenzy of selling as negative political news and fears over the terror financing list decision dampened any positive economic triggers, dealers said.

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index lost 1.44 percent or 588.61 points to close at 40,209.82 points level, while volumes increased to 377.650 million shares, as compared with the turnover of 358.824 million shares in the previous session.

KSE-30 shares index followed suit with a low of 1.54 percent or 265.89 points to end at 17,013.60 points level. AA Soomro, managing director KASB Securities said positivity was short-lived in the morning, as Supreme Court Justice Qazi Faiz Esa, the very judge against whom a presidential reference was filed, sent a notice to the prime minister for attending Insaf Lawyers Forum. “This noise was dampening enough amid opposition’s expected protests,” he said.

Moreover, Asia-Pacific Group (APG) continued to keep Pakistan on “enhanced follow up list”, dispelling any optimism. “Our base case is FATF (Financial Action Task Force) keeping grey list. The trajectory for next few days would be dominated by movements in currency, current account numbers and international oil prices,” Soomro added.

Muhammad Saeed Khalid, head of research at Shajar Capital said, “Despite announcement of 31 percent growth in remittances in the first quarter of FY21, stock market slumped after the acceptance of resignation of General Asim Saleem Bajwa by the PM.”

Investors remained cautious and booked capital gains in the automobile sector on expected sales numbers. “Further, we also witnessed high volumetric activity in Power and Hascol where investors traded aggressively to average their wealth prices,” Khalid added.

Trading activity was recorded in 406 active scrips, of which 74 increased, 314 lost, and 18 remained unchanged.

Analyst Ahsan Mehanti from Arif Habib Corporation said stocks were weighed down by dismal CPI inflation in September at 9.04 percent and concerns on APG keeping Pakistan in its enhanced follow up list on finding about meagre progress on FATF compliance.

Early session support was witnessed in cement stocks on 17.65 percent surge in sales and exports in September. However, political uncertainty, and doubts on FATF decision expected during October 21-23 played a catalytic role in the bearish close, Mehanti added.

With political temperature rising and market making a decent comeback in the last four trading sessions, participants took it as an opportunity to book profits.

Salman Ahmad, head of institutional sales at Aba Ali Habib said, “The city situation, political rally organised by the opposition against the government and resignation of special assistant to prime minister were enough to make heavy dents in the market sentiment.”

Top gainers were Bhanero Textile, gaining Rs66.27 to close at Rs958.98/share, and Faisal Spinning, up Rs17.87 to finish at Rs300.00/share, while Indus Dyeing, down Rs39.12 to close at Rs507.01/share, and Premier Sugar, losing Rs32.98 to close at Rs466.01/share, were the main losers.

With 50.577 million shares, Power Cement was on the top of the volumes chart. It declined Re0.5 to end at Rs9.02/share. Azgard Nine, with 9.823 million traded shares, was at the bottom. It gained Re0.58 to end at Rs18.47/share.