PSX flat over policy rate, IMF uncertainty
Pakistan Stock Exchange (PSX) on Monday closed almost flat amid uncertainty surrounding the State Bank of Pakistan's (SBP) monetary policy decision later in the day and the outcome of review talks between Pakistan and the International Monetary Fund (IMF).
Analysts attributed the bearish performance to foreign fund outflows, a weak rupee and expectations of an increase in the Consumer Price Index (CPI)-based inflation. The KSE-100 index fluctuated between the peak of 650 points and the low of 246 points, before settling at 114,356, reflecting a thin decline of 42 points.
Ahsan Mehanti of Arif Habib Corp stated that stocks closed flat amid uncertainty about the SBP's monetary policy and the outcome of Pakistan-IMF talks after reports suggested that the lender had opposed the idea of circular debt settlement through taking loans from banks. Foreign outflows, a weak rupee and an expected surge in CPI inflation played the role of catalysts in bearish close at the PSX, he said.
At the end of trading, the benchmark KSE-100 index recorded a decrease of 42.36 points, or 0.04%, and settled at 114,356.34.
In its review, Topline Securities commented that the stock market experienced a volatile session, with the benchmark index fluctuating between the peak of 650 points and the low of 246 points. It ultimately closed at 114,356, reflecting a modest decline of 42 points (-0.04%).
The market's performance was largely influenced by prevailing uncertainty surrounding the monetary policy and circular debt concerns, it said. The positive movement was primarily fuelled by Engro Holdings, UBL, HBL, Pakistan Oilfields and Service Industries, which together contributed 504 points to the index. Conversely, Pakistan Petroleum, Oil and Gas Development Company and Pakistan State Oil (PSO) weighed on the market, pulling the index down by 317 points, Topline noted.
Arif Habib Limited (AHL) reported that the week started flat at the PSX, ahead of the SBP's monetary policy committee meeting, with the high-on-day touching 115,000 points.
Some 42 shares rose while 53 fell, with UBL (+1.98%), Engro Holdings (+4.06%) and HBL (+2.23%) contributing the most to index gains. On the flip side, Oil and Gas Development Company (-4.05%), Pakistan Petroleum (-2.76%) and Pakistan State Oil (-3.84%) were the biggest index drags, AHL commented.
"Venturing above 115k bodes well for the remainder of the week, with expectations of gains towards 116k," it added.
Ali Najib of Insight Securities stated in his market review that the PSX resumed trading in the new week in a consolidation mode as the KSE-100 index ended on a flat note at 114,356, down 42 points, or 0.04%.
During the day, a mixed behaviour was witnessed, ahead of the crucial monetary policy announcement by the State Bank for the next couple of months. "The street view was scattered from maintaining the status quo to a 100-basis-point cut," he said.
Najib added that movements in the KSE-100 index remained range bound amid a low trading volume.
Overall trading volumes decreased to 324.7 million shares compared with Friday's tally of 404.4 million.
Shares of 435 companies were traded. Of these, 194 stocks closed higher, 170 fell and 71 remained unchanged. The value of shares traded during the day was Rs20.7 billion.
Power Cement was the volume leader with trading in 24.8 million shares, gaining Rs0.6 to close at Rs11.76. It was followed by Fauji Cement with 22.2 million shares, falling Rs2.08 to close at Rs43.91 and Maple Leaf Cement with 19.8 million shares, falling Rs0.6 to close at Rs56.03. During the day, foreign investors sold shares worth a net Rs186.5 million, according to the National Clearing Company.
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