PSX down ahead of MSCI decision

Stocks fell on Tuesday ahead of index provider MSCI’s decision on the fate of apex bourse, amid rupee spiral, which is panicking foreigners into selling stocks that are becoming costlier owing to dollar strength, traders said.

The benchmark KSE-100 Shares Index shed 188.56 points or 0.40 percent to close at 46,729.96 points at Pakistan Stock Exchange's (PSX) after hitting a high of 47,995.10 points and a low of 46,619.68 points.

Haris S Khan, an analyst at Topline Securities, said the index continued to slide owing to concerns regarding the reclassification of Pakistan from the MSCI Emerging Market Index to the MSCI Frontier Market Index which was expected later on Tuesday.

He said the cement sector witnessed aggressive selling owing to higher coal prices after which the sector closed down on an average 1.45 percent for the day.

On the corporate front, Nestlé Pakistan notified the bourse that the sponsor had purchased 1.15 million shares under the NDM (Negotiated Deal Market) at a price of Rs6,000/share after which the stock closed 7.5 percent higher for the day, Khan said.

He added that LUCK, TRG, PSX, OGDC, and POL were the major losers of the today and dragged the index lower by a cumulative 102.5 points.

KSE-30 Shares Index also gave up 100.94 points or 0.54 percent to close at 18,747.04 points.

Ahsan Mehanti, an analyst at Arif Habib Corp, said stocks closed under pressure ahead of MSCI decision and speculations for likely government policy to stall industrial imports impacting growth.

Investor concerns over ongoing rupee rout, foreign outflows, and surging balance of payment deficit led to bearish close, Mehanti said.

Traded shares increased 6 million shares to 423.75 million shares from 417.85 million shares. Trading value decreased to Rs11.28 billion from Rs12.02 billion. Market capital narrowed to Rs8.218 trillion from Rs8.240 trillion. Out of 520 actives in the session, there were 129 advancers and 373 retreaters, while 18 closed without a change.

Nestle Pakistan became the top gainer by rising Rs423.75 to Rs6,073.75 per share, followed by Allawasaya Textile, up Rs75.72 to close at Rs1,085.32 per share.

Being the worst loser, Unilever Foods XD fell Rs1,645 to Rs20,300 per share, followed by Colgate Palm that lost Rs50 to end at Rs2,725 per share.

Brokerage Arif Habib Ltd said at the brink of an important MSCI decision the index ended in the red.

“The feelings were negative due to continuous foreign selling in cement and banking sector stocks due to MSCI reclassification and otherwise depreciating rupee against dollar that makes holding Pakistani stocks a costly affair, while local investors have lately been absorbing negative foreign flows in a gradual and cautious manner,” the brokerage said.

The negatively contributing sectors included cement (-75 points), exploration and production (-39 points), autos (-29 points), oil and gas marketing (-23 points), and chemical (-21 points).

TPL Corp Ltd was the highest traded stocks with a turnover of 41.82 million shares. It gained 60 paisas to close at Rs25.28 per share. Kohinoor Spinning with 33.72 million shares was the second most traded stock. It lost seven paisas to settle down at Rs6.81 per share.

Stocks that recorded significant turnover included PIAC (A), WorldCall Telecom, Byco Petroleum, Telecard Limited, Service Fabrics (R), Azgard Nine, TPL Properties and PTCL.

Turnover in the future contracts dropped to 98.81 million shares from 104.85 million on Monday.