Equity market declines by 392 points on law and order situation

Equity market declines by 392 points on law and order situation

The equity market experienced a significant downturn on Monday, with the benchmark KSE-100 index of the Pakistan Stock Exchange (PSX) closing at 44,914 points, marking a decline of 392 points from the previous close of 45,306 points.

This drop at the equity market was primarily attributed to the deteriorating law and order situation that unfolded a day earlier.

Analysts at Arif Habib Limited observed that the KSE-100 index initially plummeted by 694 points during the session, reflecting the immediate reaction of the equity market to the weekend turmoil. However, the index managed to recover approximately 600 points before settling at a net loss.

The transition of the new Finance Minister, who took charge on the same day, provided a boost to investor confidence. Despite this positive development, the selling pressure remained strong enough to limit the recovery of the equity market.

In the Fertilizer sector, Engro Fertilizers Limited (EFERT) announced robust financial results, including a healthy dividend payout, which contributed positively to the performance of the equity market. Notably, WorldCall Telecom Limited (WTL) led the trading volumes with 101.4 million shares, followed by Byco Petroleum Pakistan Limited (BYCO) with 24.2 million shares, and TRG Pakistan Limited (TRG) with 23.4 million shares.

Several sectors experienced declines at the equity market, with Technology shedding 128 points, Banks losing 54 points, Power dropping 36 points, Textile falling 33 points, and Cement decreasing by 30 points. These sectors collectively contributed to the overall negative performance of the market.

Despite the decline at the equity market, trading volumes saw a significant increase, rising from 173.5 million shares to 363.1 million shares, a 109 percent increase day-over-day (DoD). The average traded value also surged by 47 percent, reaching USD 84.1 million compared to the previous USD 57.2 million.

Key stocks that significantly contributed to the trading volumes included WTL, BYCO, TRG, Gas & Oil Pakistan Limited (GGL), and Telecard Limited (TELE), together accounting for 52 percent of the total trading volume.

Stocks that had a positive impact on the market included Mari Petroleum Company Limited (MARI) with a gain of 29 points, EFERT with 21 points, Engro Corporation (ENGRO) with 17 points, Abbott Laboratories Pakistan Limited (ABOT) with 8 points, and Honda Atlas Cars (HCAR) with 7 points.

Conversely, stocks that dragged the market down included TRG, which lost 126 points, Hub Power Company Limited (HUBC) down by 31 points, Fauji Fertilizer Company Limited (FFC) down by 22 points, Habib Bank Limited (HBL) down by 19 points, and Pakistan State Oil (PSO) down by 16 points.

Overall, while the market faced pressure from the law and order issues, the introduction of the new Finance Minister and positive corporate results in certain sectors provided some respite, preventing further losses.