Stocks plunge by 715 points on PKR weakening

Stocks plunge by 715 points on PKR weakening

KARACHI: The stocks plunged by 715 points on Tuesday owing to weakening in the value of Pak Rupee (PKR). The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 46400 points as against previous day’s closing of 47,115 points showing a decrease of 715 points.

Analysts at Arif Habib Limited said that bloodbath session was witnessed today due to the further weakening of Pak Rupee against dollar, concerns on inflation and resumption of foreign selling spree.

Market opened on a bleak note after the news clocked in the morning that revival of USD six billion stalled IMF program for Pakistan hinges upon stamped clearance of IMF’s two departments before forwarding it in front of the Fund’s Executive Board.

Textile sector continued to remain under pressure for second consecutive session over concerns on ending of subsidized gas supply.

Institutional activity remained on the sell-side due to redemptions from the mutual fund industry.

Accumulation was witnessed in the banking sector as KIBOR rates have witnessed a sharp rise in the past one month, where the spread between the 6M KIBOR and policy rate has touched a high of 162 basis points, increasing from its average spread of 50 basis points.

In the last trading hour, sell-off was witnessed across the board mainly as investors opted for cautious approach.

Sectors contributing to the performance include Commercial Banks (-123 points), Cement (-102 points), Technology (-79 points), E&P (-63 points) and Power (-46 points).

Volumes increased from 364.9mn shares to 434.7 million shares (+19.1 per cent DoD). Traded value also increased by 11.6 per cent to reach US$ 83.1 million as against US$ 74.5 million.

Stocks that contributed significantly to the volumes include TELE, FFLR1, FNEL, WTL and GGL.

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