The Pakistan Stock Exchange (PSX) on Monday suffered intense battering as the benchmark KSE-100 index plummeted below the 46,000 point level after shedding 744 points.
The heavily anticipated resumption of the loan program with the International Monetary Fund (IMF) was unsuccessful in boosting investor sentiment which had dampened owing to a higher than expected increase of 150 basis points in the benchmark interest rate.
The market remained bearish throughout the day, as nervous investors offloaded their positions in the midst of massive foreign selling. Index heavy automobile, fertilizer, cement, oil, and financial sectors bore the brunt of across the board profit-taking and closed mostly with losses.
Even the fresh appreciation in the local currency against the greenback was downplayed by the market participants as they continued to sell off their holdings.
Trading commenced with a brief rally as the market surpassed the 46,600 point mark during the initial hour, however, the index failed to sustain the uptrend and it dropped owing to widespread profit-taking and remained in the negative territory for the remaining session.
Towards closing the benchmark KSE-100 index recorded a plunge of 744.41 points, or 1.6%, as it settled at 45,745.
A report issued by Arif Habib Limited said that the bears ruled over the bulls on Monday as investors were on the edge due to a higher than expected interest rate increase.
The start of the roll-over week witnessed bearish momentum despite the long awaited news that Pakistan and the International Monetary Fund (IMF) have reached a staff-level agreement.
Initially, only cyclical stocks fell under the radar and investors began offloading positions. Later, a bloodbath session was witnessed as selling came across the board.
On the institutional front, a cautious stance was observed owing to concerns of foreign selling spree.
Sectors contributing to the performance include cement (-184 points), technology (-153 points), exploration and production (-90 points), fertilizer (-70 points), and textile composite (-36 points).
JS Global analyst Waqar Iqbal shared that the KSE-100 index rose by 112 points during the intra-day trading, but it was unable to sustain the positive momentum.
Two key announcements were made over the weekend; 1.5% hike in the interest rate and the government reaching staff-level agreement with the IMF.
The analyst added, “Realisation of the IMF money with the Saudi assistance package is expected to provide a reason for the market to rebound”.
Overall trading volumes plunged to 261.9 million shares in comparison with Friday’s tally of 304.21 million. The shares traded during the day were valued at Rs10.94 billion.
Shares of 344 companies were traded. Towards the end of the day, 70 stocks closed higher, 263 declined and 11 remained unchanged.
TRG Pakistan Limited led the volume chart with 22.37 million shares, losing Rs7.74 to close at Rs95.51. It was followed by Byco Petroleum with 21.6 million shares, shedding Rs0.21 to close at Rs6.83, and TPL Properties XB with 15.8 million shares, losing Rs0.83 to close at Rs49.46.
As per data compiled by the National Clearing Company of Pakistan, foreign institutional investors were net sellers of Rs1.68 billion worth of shares during the trading session.
