KARACHI: Pakistan’s equities faced a downturn on Friday as the delay in reaching a Staff Level Agreement (SLA) disappointed investors.
The benchmark KSE-100 index of the Pakistan Stock Exchange (PSX) concluded at 41,330 points, registering a decline of 364 points from the previous day’s closing at 41,694 points.
Analysts at Arif Habib Limited reported that the PSX recorded a negative session to conclude the business week. The market opened in the negative zone and continued to trade in both directions during the opening session, reflecting the prolonged anticipation of an SLA agreement between the government and the International Monetary Fund (IMF).
As the second session commenced, investors chose to book profits, resulting in the index falling to an intraday low of 423.28 points. The current political uncertainty and the approaching weekend, marked by uncertainties on both the political and economic fronts, influenced investor sentiment, leading to a cautious approach in the market.
Investors’ participation remained sluggish, and dull volumes were observed across the board. Sectors contributing to the overall performance exhibited negative trends, with Technology & Communication (-103.7 points), Fertilizer (-71.2 points), Commercial Banks (-50.1 points), Miscellaneous (-47.9 points), and E&P’s (-36.9 points) experiencing declines.
Volumes decreased from 234.7 million shares to 172.6 million shares, representing a 26.5 percent Day-on-Day (DoD) decline. The average traded value also decreased by -7.7 percent, reaching $28.47 million compared to the previous day’s $26.42 million.
Stocks that significantly contributed to the trading volumes included HBL, HASCOL, PIBTL, WTL, and FFL. These stocks attracted attention from investors and played a role in shaping the overall trading activity during the session.
The delay in reaching an SLA agreement, particularly between the government and the IMF, has been a key factor impacting investor confidence in the Pakistani stock market. The prolonged anticipation has created an atmosphere of uncertainty, influencing trading decisions and market dynamics.
The political uncertainty and economic concerns have added to the cautionary stance adopted by investors, reflected in the sluggish participation and dull volumes. As the market navigates these challenges, the coming weeks may see continued sensitivity to developments on the domestic and international fronts, especially those related to economic agreements and political stability.
Investors are likely to closely monitor updates on the SLA agreement and its implications for the economic outlook. The performance of key sectors and individual stocks will be influenced by the evolving situation, requiring market participants to stay vigilant and adapt to changing conditions in the coming sessions.
