Tuesday October 03, 2023

Stocks dip for 4th day as politics weighs

By Our Correspondent
September 23, 2022

The worsening currency crisis did not let stocks break out of a four-day long bear hug amid emerging political upheaval, traders said.

The Pakistan Stock Exchange's (PSX) benchmark KSE-100 Shares Index ended flat by losing 37.63 points or 0.09 percent to 40,927.95 points.

Darson Securities said the local equity bourse underwent another volatile session even though the country’s current account deficit shrank by 19 percent during the first two months of this fiscal year (FY23).

“Earlier as trading kicked off, the benchmark index hit an intra-day high of 40,986.95 plus (21.37) points but gains could not be sustained and after the first few minutes it started retreating,” the brokerage report said.

“At one point during the day, the index fell more than 500 points. However, at lower levels a value-buying spree trimmed most of the losses.”

The downtrend continues as Pakistan is expected to receive $1.5 billion from Asian Development Bank (ADB) and $500 million from Asian Infrastructure Investment Bank (AIIB) and the governments of Japan and Pakistan have agreed on debt deferral amounting to around $160 million.

The KSE-30 index, however, increased by 18.75 points or 0.12 percent to 15,355.53 points compared with 15,336.78 points recorded in the last session.

Ahsan Mehanti at Arif Habib Corp said stocks tracked a global selloff as political turbulence was on the rise. Weak rupee and ADB’s slashing of the GDP growth forecast to 3.5 percent for FY23 strengthened doubts on the recovery of the economy in the wake of flood losses, Mehanti said.

Traded shares increased by 20 million shares to 190.091 million shares from 170.416 million shares. The trading value rose to Rs6.322 billion from Rs4.827 billion. Market capital narrowed to Rs6.722 trillion from Rs6.728 trillion. Out of 328 companies active in the session, 106 rose, 203 fell, and 19 remained unchanged.

Topline Securities, said the stocks largely remained under pressure during the trading session after the PTI chairman announced his party was launching a fresh movement from Saturday to press the government to hold early elections.

“However, some recovery was observed in the last hours of trading as the PTI chairman tendered an apology before the Islamabad High Court in the contempt of court case,” the brokerage said.

A major contribution to the Index came from TRG, OGDC, SYS, LUCK & ENGRO, as they cumulatively contributed 126 points to the index, on the flip side POL, HUBC, FFC, MTL, and HMB lost value to weigh down on the index by 72 points.

Arif Habib Ltd, in its post-session analysis report, said the PSX witnessed a negative session due to political noise.

“The index nosedived following the same trend from the previous session although in the last trading hour value buying helped the index claw back a good deal of losses,” it reported.

Sectors contributing to the negative performance included banks (-19.3 points), autos (-16.3 points), and investment banks (-11.6 points), pharma (-11.3 points), and power (-11.2 points).

WorldCall Telecom was the volume leader with 19.954 million shares, followed by Cnergyico PK with 18.598 million shares.

Turnover in the future contracts increased to 62.627 million shares from 50.295 million shares.