Karachi, December 22, 2023 – The KSE-100 Index of the Pakistan Stock Exchange (PSX) continued its downward spiral on Friday, marking another significant plunge of 988 points in the ongoing bloodbath to conclude the week.
The index closed at 61,705 points, down from the previous day’s closing of 62,693 points. This week’s turmoil has seen the stock market lose approximately 4,425 points, constituting a substantial 6.7 percent decrease in value.
Analysts at Topline Securities Limited noted that the KSE-100 Index remained range-bound during the first half of the trading session ahead of the long weekend. However, selling pressure intensified in the second half of the session, causing the index to decline and ultimately close at the 61,705 level, marking a 1.58 percent drop.
Investor participation dwindled, with the average traded volume and value standing at 669 million shares and Rs13.6 billion, respectively. Leading the losses were PPL, HBL, OGDC, HUBC, and TRG, collectively weighing down the index by 324 points. FFL emerged as today’s volume leader with 48 million shares.
The decline in the KSE-100 Index for the second consecutive week, resulting in a cumulative 6.7 percent loss on a week-over-week (WoW) basis, is attributed to profit-taking by institutional investors and individual investors selling to meet margin requirements against their leverage positions.
Key events during the outgoing week included a notable shift in the Current Account, which after four consecutive months of deficit, recorded a Current Account Surplus (CAS) of $9 million in November 2023. Foreign Direct Investment (FDI) saw a significant uptick, clocking in at $131 million, reflecting a 7 percent month-over-month (MoM) increase and a 12 percent year-over-year (YoY) surge in November 2023. Additionally, a fixed bond PIB auction saw the government raising Rs397 billion (Competitive & Non-Competitive) against a target of Rs190 billion, with cut-off yields declining by 7-19 basis points.
Investor participation metrics reflected a decline during the week, with average daily traded volume and value standing at 1.2 billion shares (down by 4.3 percent WoW) and Rs22 billion (down by 27 percent WoW), respectively.
The ongoing bloodbath in the stock market raises concerns among investors and market participants, prompting a closer examination of the underlying factors contributing to the sell-off. The impact of profit-taking, institutional decisions, and the broader economic landscape will be closely monitored in the coming weeks to gauge the market’s resilience and potential for recovery.
