Share market plunges 786 points on high inflation risk, political uncertainty

Share market plunges 786 points on high inflation risk, political uncertainty

KARACHI: The share market plunged by 786 points on Monday owing to high inflation risk following rise in international oil prices and political uncertainty on possible change in Punjab setup.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 45,051 points as against last Friday’s closing of 45,837 points, showing a decline of 786 points.

Analysts at Arif Habib Limited said that in the aftermath of PM’s vote of confidence from the Parliament, the market saw a heavy draw down with an oscillation of 1583 points posting an increase of 595 points in the early part of the session and dropping by 988 points during the session. The Index closed 786 points.

Political uncertainty emanating from possible change in Punjab’s political setup perturbed investors, at the same time recent rapid upsurge in inflation (primarily international crude oil prices) also caused Investors to think twice about upcoming monetary policy and impact thereof on cyclicals.

Resultantly, cement, steel, O&GMCs saw major attrition today. Over the weekend increase in international crude oil prices helped E&P stocks to stay afloat, however, selling pressure in other stocks also brought pressure in OGDC and PPL as well. Among scrips, ANL topped the volumes with 48.2 million shares, followed by UNITY (45.4 million) and TRG (35.4 million).

Sectors contributing to the performance include Cement (-205 points), Banks (-104 points), Power (-67 points), Autos (-49 points) and Pharma (-46 points).

Volumes increased from 317.2 million shares to 459.8 million shares (+45 percent DoD). Average traded value also increased by 55 percent to reach US$ 157.5 million as against US$ 101.5 million.

Stocks that contributed significantly to the volumes include ANL, UNITY, TRG, PRL and BYCO, which formed 37 percent of total volumes.

Stocks that contributed positively to the index include PAKT (+10 points), POL (+10 points), ANL (+7 points), MEBL (+3 points) and FCEPL (+2 points). Stocks that contributed negatively include LUCK (-85 points), HUBC (-48 points), HBL (-39 points), DGKC (-36 points) and INDU (-24 points).

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