Late selling erases all gains at PSX

Pakistan Stock Exchange (PSX) on Wednesday reversed course following notable gains a day ago as selling pressure later in the trading session wiped out earlier gains of almost 600 points and the KSE-100 index closed with a loss of nearly 500 points.

The decline was largely driven by anxiety over the ongoing International Monetary Fund (IMF) review and subdued activity in the current month of Ramazan, which led to caution and increased selling pressure.

Initially, the KSE-100 opened on a positive note, reaching the intra-day high of 113,327 points. Stock buying was observed in sectors such as automobile assemblers, cement, chemical, commercial banks, oil and gas exploration, power generation and refineries. However, selling intensified in the afternoon, causing the index to drop to the intra-day low of 112,146.

Arif Habib Corp MD Ahsan Mehanti commented that stocks fell sharply amid a sell-off in Asian markets and a slump in global crude oil prices due to Donald Trump’s tariff war. “Foreign outflows, a weak rupee and an expected surge in CPI inflation this month played the role of catalysts in the bearish close at the PSX,” he added.

At the end of trading, the benchmark KSE-100 index posted a decline of 490.04 points, or 0.43%, and settled at 112,253.76. Topline Securities wrote in its review that the stock market witnessed a range-bound session, where the benchmark index moved between the high of 583 points and low of 598 points. It closed at 112,254, marking a decline of 490 points.

 

Investor sentiment remained mixed due to the ongoing month of Ramazan. The upward movement was mainly driven by Engro Holdings, Tariq Glass Industries, Lucky Cement, Pakistan International Bulk Terminal and Nestle Pakistan, which contributed 155 points, it said. On the other hand, Engro Fertilisers, Fauji Fertiliser and Pakistan State Oil deprived the index of 181 points, Topline added.

Arif Habib Limited (AHL) stated in its report that on Wednesday more than half of Tuesday’s gains were wiped off, leaving the KSE-100 just above 112k. A total of 34 shares rose while 60 fell, with Engro Holdings (+1.74%), Tariq Glass (+4.33%) and Lucky Cement (+0.39%) contributing a major chunk of gains to the index. Conversely, Engro Fertilisers (-1.62%), Pakistan State Oil (-2.38%) and Fauji Fertiliser (-0.5%) were the biggest drags, it said.

The average daily trading volume remained below $50 million and the market “is now looking towards news from the IMF review as the next potential trigger”, AHL added. KTrade Securities, in its market wrap, termed Wednesday’s trading lacklustre, when the benchmark index closed down 0.43%.

It attributed the decline mainly to low volumes and ongoing pressure from the IMF review. Besides, weak performances in banking, fertiliser and oil & gas sectors caused the downturn, with stocks of big companies contributing significantly to the decline. Despite the current fall, it said, the market had long-term prospects, driven by improving fundamentals and attractive valuations. It expected cyclical and exploration & production stocks to outperform once market sentiment improved.

JS Global analyst Muhammad Hasan Ather said the stock market initially witnessed a rally, which pushed the index up by 583 points. Key sectors such as cement and commercial banks saw significant activity.

Looking ahead, the outcome of IMF review could provide direction to the market. If approved, it may unlock additional funding, boosting investor confidence, he projected. Overall trading volumes increased to 264 million shares compared with Tuesday’s tally of 206.9 million.

Shares of 431 companies were traded. Of these, 165 stocks closed higher, 197 fell and 69 remained unchanged. The value of shares traded during the day was Rs13.7 billion.

Pakistan International Bulk Terminal was the volume leader with trading in 53.6 million shares, rising Rs0.46 to close at Rs9.58. It was followed by WorldCall Telecom with 23.6 million shares, falling Rs0.06 to close at Rs1.34 and Power Cement with 10.98 million shares, losing Rs0.25 to close at Rs10.94. During the day, foreign investors sold shares worth Rs32.2 million, the NCCPL reported.