Equity market plunges by 596 points on expected tough budgetary measures

KARACHI: The equity market plunged by 596 points on Wednesday owing to concerns over interest rate rise and tough measures in the budget.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 35,035 points as against 35,631 points showing a decline of 596 points.

Analysts at Arif Habib Limited said that KSE-100 index had a major draw down of 781 points that was caused by across the board selling.

Market started on a positive note with 35 points but the selling pressure that was witnessed in the past couple of sessions started reflecting soon.

Power, E&P, Cement, Steel, Banks and Chemical sectors contributed mainly to the volumes and also to decline. KEL declined significantly in the early session but started recovering by day end.

Overall, KEL registered a volume of 16.7M shares followed by SNGP (5.7M) and MLCF (5.2M). Investors seem to have concerned about the repercussions of IMF conditionalities, as well as a host of issues from rising interest rates to an impending tough budget.

Sectors contributing to the performance include Fertilizer (-133 points), E&P (-105 points), Banks (-55 points), O&GMCs (-51 points), Power (-41 points).

Volumes increased significantly from 65.4mn shares to 113.2mn shares (+73 percent DoD). Average traded value also increased by 67 percent to reach US$ 32.3mn as against US$ 19.4mn.

Stocks that contributed significantly to the volumes include KEL, SNGP, MMLCF, PIBTL and WTL, which formed 32 percent of total volumes.

Stocks that contributed positively include COLG (+13 points), UBL (+10 points), BAFL (+3 points) SHEL (+3 points) and ARPL (+2 points). Stocks that contributed negatively include MCB (-51 points), ENGRO (-36 points), FFC (-34 points), PPL (-32 points) and MARI (-28 points).

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