Stocks lose 178 points amid political uncertainty and foreign outflows

KARACHI: Stocks closed lower on the first day of the week, Monday, as investors remained concerned amid political uncertainty and foreign outflows.

The Pakistan Stock Exchange’s (PSX) benchmark KSE-100 share index decreased by 177.93 points or 0.22 per cent to 81,114.2 points against 81,292.13 points recorded in the last session. The highest index of the day remained at 81,321.64 points while the lowest level was recorded at 80,352.22 points.

Analyst Ahsan Mehanti at Arif Habib Corp said, “Stocks closed under pressure on political uncertainty and foreign outflows.”He said that government action on IPPs tariff, concerns over the outcome of a tax collection shortfall and delays over the privatization of SOEs played a catalyst role in the bearish close.

The KSE-30 index decreased by 34.39 points or 0.13 per cent to 25,775.98 points against 25,810.37 points.Traded shares dropped by 42 million shares to 297.994 million shares from 339.323 million shares. The trading value rose to Rs14.103 billion from Rs12.893 billion. Market capital narrowed to Rs10.619 trillion against Rs10.653 trillion. Of the 444 companies active in the session, 132 closed in green, 244 in red and 68 remained unchanged.

Naveed Nadeem, an analyst at Topline Securities, said the KSE-100 index closed the trading session at 81,114, marking a decrease of 178 points, or 0.22 per cent.Major contributor to this fall was Hub Power (139 points) which fell by 3.6 per cent due to concerns regarding potential revisions to its power plant contracts and payout ability. Other stocks that contributed to the downward momentum were MEBL, TRG, BAHL and Engro. These stocks collectively eroded 194 points from the index.

In contrast, Mari Petroleum’s share price saw a drop following the distribution of bonus shares to investors, however, it managed to recover and closed the day in positive territory -- up 4.1 per cent -- contributing 130 points to the index. FFC remained strong and closed 2.6 per cent up.

The highest increase was recorded in Lucky Core Industries Limited, which rose by Rs30.9 to Rs1,051.03 per share, followed by Mari Petroleum Company Limited, which increased by Rs16.71 to Rs425.54 per share. A significant decline was noted in Rafhan Maize Products Company Limited, which fell by Rs542.49 to Rs6,804.26 per share; Unilever Pakistan Foods Limited followed it, which closed lower by Rs149.94 to Rs17,075.06 per share.

Brokerage Arif Habib Ltd said that the KSE-100 dipped into the weekly support zone of 80-81k before recovering, putting the market on alert for a potential bottom and resumption of upside momentum.

Pakistan’s economy grew faster than expected last quarter, with GDP rising by 3.07 percent year-over-year in the three months ending June, buoyed by funds from the International Monetary Fund (IMF) and lower interest rates. Meanwhile, the government plans to cut 150,000 vacant government jobs by June as part of a pledge to the IMF to address economic distortions. The cabinet has also approved a rightsizing plan, including shutting down one ministry and merging two others.

The State Bank of Pakistan (SBP) received the first tranche of $1 billion from the IMF on Friday. The KSE-100 and KSE-30 are now positioned in zones from where a bottom is expected, with potential for the market to resume its advance, stated the brokerage.

PIA Holding Company remained the volume leader with 43.078 million shares which closed lower by 8 paisas to Rs18.74 per share. WorldCall Telecom followed it with 21.681 million shares, which closed flat at Rs1.20 per share.

Other significant turnover stocks included Hub Power Co XD, K-Electric Ltd, Fauji Fert Bin, Kohinoor Spinning, Nishat ChunPow, Air Link Commun XD, Pace (Pak) Ltd., and Secure Logistics Gro.In the futures market, 315 companies recorded trading, of which 104 increased, 204 decreased and 7 remained unchanged.