Stocks end lower in roller coaster trade
Shares tumbled wildly into negative territory on Wednesday as the embattled government is likely at a serious disadvantage in its political fight against the opposition, traders said.
The KSE-100 equity index, the benchmark of the Pakistan Stock Exchange (PSX), fell 101.14 points or 0.23% to 44,337.56 after hitting a high of 44,444.87 and a low of 43,975.75 points during the intraday trade.
Ahsan Mehanti of Arif Habib Corp said a plummeting rupee amid political uncertainty stemming from a vote of no confidence in the prime minister weighed on stocks.
Worries over the current account deficit and rising import bills affecting the rupee added to the selling pressure, Mehanti said.
He added that fertilizer, cement and textile certificates supported the index to close above the day’s low.
The KSE-30 equity index fell 60.25 points or 0.35% to 16,923.07 points.
Trading volume increased by 76 million shares to 344.13 million from 268.91 million shares, while the value rose to 7.779 billion rupees from 7.174 billion rupees.
Turnover in futures increased to 96.56 million shares from 82.89 million shares.
Market capital decreased to Rs7.481 trillion from Rs7.482 trillion. Of the total active scripts, 158 had gains, 169 losses, while 27 remained unchanged.
Topline Securities’ Muhammad Arbash said growing political uncertainty led the market to open sideways where it hit an intraday low of 463 points.
However, some recovery was seen in the second half of the session, Arbash said.
OGDC, FFC and PSO added 57 points of impact on the index, while MCB, MEBL and UBL lost due to profit taking.
Rafhan Maize led the performers, earning Rs 500 to close at Rs 12,000/share, followed by Nestlé Pakistan XD, which grabbed Rs 90 to close at Rs 5,500/share.
To become the worst tapper of the day, Otsuka Pak lost Rs19.12 to Rs235.88 per share, followed by Packages Ltd. which decreased from Rs14.58 to Rs428.27 per share.
Mubashir Anis Naviwala, an analyst at JS Research, said the market was on a roller coaster as political unrest peaked in the country.
“Going forward, we recommend investors to remain cautious at current levels and wait for any further buying,” Naviwala said.
The country’s politics are heading towards a confrontation between the government and the opposition which sharpens a sharp parliamentary tool in the form of a motion of no confidence to shorten the mandate of this regime. The infighting ruling alliance suffered another political blow on Wednesday after the MQM announced it had abandoned the PTI and walked out of the alliance.
The government appears flustered as Prime Minister Imran Khan’s address to the nation, scheduled for Wednesday, has been postponed until further announcement.
Analysts say the first casualty of a change in government will most likely be the economy, which is currently teetering on the crutches of loans, grants and aid.
Brokerage firm Arif Habib Ltd said the index remained in the red all day due to political unrest and the further devaluation of the rupee against the dollar.
“Motherboard activity remained lackluster. On the other hand, activity continued to remain sideways as the market saw strong volumes in third-tier stocks,” he noted.
K-Electric Ltd led the volume chart with 38.41 million shares, followed by Ghani Global Holding with 31.11 million shares. Stocks that saw strong turnover included WorldCall Telecom, Pak Elektron (R), Treet Corp, Telecard Limited, TPL Properties, TPL Corp Ltd, Agritech Limited and Waves Singer.