Pakistan Stock Exchange (PSX) endured a rangebound session on Wednesday, influenced by the rupee’s continuous fluctuation, weak corporate earnings and a rising power tariff.
In the morning, the trading session began on a promising note reaching an intra-day high of 47,588.23 points, but soon it began stumbling over investor concerns about the poor economic scenario.
Investors were worried over the surging inflation, currency devaluation and anticipation of a hike in policy rate in the upcoming monetary policy announcement.
The KSE-100 index remained directionless touching an intra-day low of 47,007.65 points, until it garnered institutional support.
It came in the wake of expectations that the Special Investment Facilitation Council (SIFC) would be able to attract foreign inflows.
The government expressed its commitment to the International Monetary Fund (IMF)’s structural benchmarks such as keeping the difference between open and inter-bank currency markets to less than 1.25% and implementing the circular debt management plan.
The aforementioned aspects helped push the bourse upwards, leading to a positive close with marginal gains.
“Stocks closed flat on investor worries over a weak industrial earnings outlook amid surging power tariff and the falling rupee,” said Arif Habib Commodities CEO Ahsan Mehanti.
“Institutional support over likely positive outcome of SIFC efforts to bring foreign investment, government’s pledge to keep difference between open and interbank exchange rates within 1.25% to stall the rupee’s fall and the execution of IMF-approved circular debt management plan played the role of catalysts in positive close of the market.” At close, the benchmark KSE-100 index recorded gains of 0.73 point and settled at 47,418.63.
Topline Securities, in its report, stated that Pakistan equities closed flat at 47,418 after a rangebound trading session.
“As per media reports, first formal contact has been made between the caretaker government and the IMF regarding the circular debt management plan,” it said, adding that the news provided some support to the overall market sentiment.
Bank, technology and cement sectors exerted selling pressure on the index as MCB Bank, Pakistan Services, Systems Limited, Dawood Hercules and Maple Leaf Cement lost a total of 90 points.
On the other hand, Bank AL Habib, Hub Power and Habib Bank gained 125 points due to increased buying interest in those stocks, Topline added.
Arif Habib Limited (AHL) observed that among key movers Pakistan State Oil (+1.48%) surprised with FY23 earnings per share (EPS) of Rs12.06 and dividend per share of Rs7.5, beating street expectations.
Bank AL Habib (+7.37%) announced 1HCY23 EPS of Rs16.27 and dividend of Rs4.5 per share, it said, adding that the market was in the zone from where it could go for the bottom or resume its advance.
JS Global analyst Muhammed Waqar Iqbal commented that investors remained concerned about inflation, currency devaluation and anticipation of rate hike in the upcoming monetary policy.
“Going forward, we recommend investors to avail any downside as an opportunity to buy stocks in construction and exportoriented sectors,” the analyst added.
Overall trading volumes increased to 188.7 million shares compared with Tuesday’s tally of 185.8 million.
The value of shares traded during the day was Rs8.8 billion.
Shares of 324 companies were traded.
At close, 106 stocks closed higher, 189 declined and 29 remained unchanged.
WorldCall Telecom was the volume leader with trading in 20.99 million shares, losing Rs0.02 to close at Rs1.27.
It was followed by Oil and Gas Development Company with 16.05 million shares, gaining Rs0.55 to close at Rs100.06 and JS Bank with 12.3 million shares, losing Rs0.07 to close at Rs5.92.
Foreign investors were net buyers of Rs115.03 million worth of shares, according to the NCCPL.