Stocks fall in tow with global markets

Stocks on Wednesday fell for a second straight session tracking a world rout amid concerns over even stringent IMF conditions, traders said.

Pakistan Stock Exchange's (PSX) benchmark KSE-100 Shares Index shed 467.89 points or 1.12 percent to 41,297.73 points against 41,765.62 points recorded in the last session. The index tested a high of 41,813.67 and a low of 41,119.46 points during the day trade.

Analyst Ahsan Mehanti at Arif Habib Corp said stocks closed bearish on the global equities selloff. “The market remained under selling pressure as investors weighed the tough IMF conditions amid high monetary targets and energy pricing ahead of the release of a $2 billion tranche next month,” he said.

Speculations ahead of SBP policy announcement next week and yawning current account deficit in May also dented the sentiment, Mehanti said.

KSE-30 Shares Index also fell 237.21 points or 1.49 percent to 15,696.62 points.

Traded shares dropped 115 million to 142.192 million from 257.163 million shares. Trading value decreased to Rs5.347 billion from Rs7.708 billion. Turnover in the futures contracts decreased to 50.520 million shares from 54.284 million shares.

Market capital narrowed to Rs6.922 trillion from Rs6.975 trillion. Out of 316 companies active in the session, 124 closed in the green, 168 in the red while 24 remained unchanged.

Topline Securities said initially the market opened on a positive note but rumours about possible restrictions on dividend payment for banks that wanted to reclassify their PIB profile, triggered a selling spree in the banking sector stocks.

Banks, tech and E&P sector stocks contributed negatively to the index.

The HBL, MCB, SYS, BAHL, and MARI lost 269 points, cumulatively. On the flip side, COLG, EFERT, and SNGP added 22 points to the index.

The highest increase was recorded in share prices of Sanofi-Aventis, which rose by Rs69.33 to Rs993.83 per share, followed by Colgate Palmolive, which jumped Rs47.99 to Rs2,247.99 per share.

Nestle Pakistan led the losers after giving up Rs190 to end at Rs5,800/share, followed by Premium Textile that slipped by Rs49.90 to Rs690.10/share.

A post-session market analysis report bt Arif Habib Ltd said the market remained under pressure due to a major sell-off in the banking stocks.

The cement sector stayed in the red zone due to an increase in Afghan coal prices and export tax, the brokerage said.

Value-buying picked up the E&P sector, it said adding, while profit-taking ensued in the last trading hour.

The major laggard sectors were banks (-271.6 points), E&Ps (-58.6 points), technology (-56.8 points), cement (-23.3 points), and power (-17.6 points).

JS Research’s Sara Saeed said investors remained skeptical over the Finance Bill and the IMF deal.

“Going forward, investors are recommended to stay cautious and adopt a buy-on-dips strategy in the banking and E&P sectors,” she advised.

K-Electric Ltd was the volume leader with 14.377 million. It closed lower by 4 paisas to Rs3.09 per share. The power utility was followed by WorldCall Telecom with 11.615 million shares. The telecom lost 3 paisas to settle at Rs1.36 per share.

Other stocks that recorded significant turnover included Hascol Petrol, Cnergyico PK, TPL Properties, Pak Refinery, Sui North Gas, Habib Bank, Kot Addu Power, and MCB Bank Ltd.