KARACHI: The Pakistan stock market took a dip on Monday as the government decided to continue the subsidy on fuel and electricity prices which increased concerns over the deal with the International Monetary Fund (IMF).
An analyst at Pearl Securities said that a big drop was expected as the government decided to continue subsidies on fuel and electric prices.
“This move has elevated concerns over the scheduled resumption of the IMF programme which would delay funds to shore up the State Bank of Pakistan’s (SBP) depleting foreign exchange reserves hovering at $10 billion.
Moreover, the rupee is continuously under pressure touching historic highs. Likewise, the international oil prices are staying above $100/barrels,” he added.
Ahsan Mehanti at Arif Habib Corp said that the stocks fell across the board as investors weighed the plunge in rupee and record surge in Treasury bill yields near to 15.26 per cent.
“A slump in the global equities, uncertainty over the terms for the resumption of the IMF programme and delays over the approval of sought Saudi aid package played a catalyst role in the bearish close,” he added.
The Pakistan Stock Exchange KSE-100 shares Index shed 1.88 per cent, or 819.14 points, to close at 42,667.32 points. The KSE-30 shares Index shed 1.99 per cent, or 329.05 points, to close at 16,212.92 points.
As many as 340 scrips were active of which 63 advanced, 263 declined and 14 remained unchanged.
The ready market volumes stood at 250.44 million shares, compared with the turnover of 208.11 million shares in the last trading session.
An analyst at Arif Habib Limited said that the benchmark KSE-100 Index witnessed a bloodbath session today, where a selling spree continued across the board which pulled the market into the red zone.
“The prevailing political uncertainty and rupee depreciation against the dollar stripped investors’ confidence which translated into panic selling,” he added.
Going forward, the analysts expect the market to remain under pressure. Hence, recommending investors adopt the “Sell on Strength” strategy in the upcoming sessions.
The companies which reflected the highest gains included Sapphire Fiber up Rs52.89 to close at Rs964.89/share, and Premium Tex up Rs34 to close at Rs750/share.
The companies which reflected the most losses included Premium Tex down Rs660.93 to close at Rs10,089.07/share, and Bata (Pak) down Rs100 to close at Rs2,000/share.
The highest volumes were witnessed in Lotte Chemical with a turnover of 18.14 million shares. The scrip gained Rs1.16 to close at Rs27/share, followed by Pak Refinery with a turnover of 18.06 million shares. It shed 57 paisas to close at Rs14.84/share. Cnergyico PK remained the third with a turnover of 14.16 million shares. It shed 31 paisas to finish at Rs5.18/share.
