KARACHI: The Pakistan Stock Exchange (PSX) experienced a downturn of 561 points on Monday, closing at 40,327 points, down from the previous session’s 40,887 points, despite positive developments from the Government Summit in the UAE.
The benchmark KSE-100 index faced a notable decline, prompting market analysts at Arif Habib Limited to attribute the negative trend to various factors. The decline occurred despite positive news emanating from the Governance Summit in the UAE, where Pakistan’s Prime Minister addressed the business community and leaders from the Gulf Cooperation Council (GCC).
Investors seemingly overlooked the support extended by the International Monetary Fund (IMF) during discussions with the Prime Minister, which took place on the sidelines of the Summit. Instead, the market faced additional pressure as Moody’s downgraded Pakistani banks, triggering panic selling among investors and pushing the index towards 40,300.
The sell-off was widespread, affecting all sectors, with no particular industry escaping the decline. The banking sector saw a significant dip, primarily influenced by Habib Bank Limited (HBL) and United Bank Limited (UBL).
Key sectors contributing to the market’s performance included Banks (-187 points), Exploration & Production (E&P) (-71 points), Cement (-62 points), Oil & Gas Marketing Companies (O&GMCs) (-50 points), Fertilizer (-50 points), and Power (+12 points).
Although the traded volume was not impressive, with a decline from 169 million shares to 134 million shares (a -21 percent day-on-day decrease), notable activity was observed in the Power sector (KEL), Cement sector (MLCF), and Banks sector (BOP). The decline in the banking sector was largely attributed to HBL and UBL.
The sectors’ negative performance translated into a 27 percent drop in the average traded value, reaching US$45 million compared to the previous session’s US$62 million.
Stocks with significant contributions to the trading volumes included KEL, PAEL, BOP, PIBTL, and TRG, collectively forming 29 percent of the total volumes.
On the positive side, stocks that contributed to the index included HUBC (+16 points), COLG (+6 points), PSMC (+2 points), THALL (+2 points), and AGIL (+2 points). Conversely, stocks making negative contributions included HBL (-45 points), LUCK (-41 points), UBL (-37 points), MCB (-34 points), and SEARL (-27 points).
As the market navigates through these challenges, investors and analysts will closely monitor global and domestic economic developments to gauge the future trajectory of the Pakistan Stock Exchange.
