Stocks on Thursday stayed on the downslide in lean trade as speculations over International Monetary Fund’s (IMF) “dos and don’ts list” for Pakistan continued to give investors nerves amid ongoing staff-level talks with lender of the last resort, dealers said.
Topline Securities in a report said the market posted losses amid Pakistan-International Monetary Fund (IMF) talks as investors were still uncertain over key economic issues.
“Investors’ main concerned remained over tax amnesty scheme, privatisation programme, power and gas tariffs, and IMF conditions,” the brokerage said.
Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index lost 0.64 percent or 236.81 points to close at 36,547.63 points, while KSE-30 shed 0.5 percent or 86.63 points to end at 17,318.41 points.
Of 323 active scrips, 74 moved up, 232 retreated, and 17 remained unchanged.
Trading activity remained dull as volumes went down by 39 percent to 67.915 million shares, as compared to 110.648 million in the previous session.
Banks, food and power sector majorly pushed down the index today as they chipped away 129 points, cumulatively, while selling was seen in select banks where HBL, MEBL and UBL chipped away 18 points, 12 points and 11 points respectively, from the index.
Analyst Ahsan Mehanti from Arif Habib Corporation said stocks fell sharply lower on investor concerns over economic uncertainty amid dismal Consumer Price Index-based inflation for April.
“IMF conditions over tightening of monetary policy, elimination of circular debt for a $6.5 billion extended fund facility and pre-budget uncertainty led to a bearish close,” Mehanti added.
Salman Ahmad, head of institutional sales at Aba Ali Habib, said volumes were low showing investors were reluctant to place sizeable deals in the share market because of conflicting rumors and developments related to IMF team meeting.
“Rumors that IMF will push Pakistan to increase its tax revenues, privatise loss-making entities and remove subsidies, disturbed the investors,” Salman said and added that as long as an agreement was not finalised, the seasoned investors would most likely stay away from the market. Dr Abdul Hafeez Shaikh, Prime Minister’s adviser on finance, has said that he was hopeful that the talks on bailout package with the IMF would turn out to be successful.
A leading trader said that another factor which impacted the stock market were the rumors that the regulator was likely to lay down some new guidelines to limit short selling.
He added in the early hours buying surfaced in the cement sector on the development that Prime Minister Imran Khan had inaugurated the Mohmand Dam, which would be completed by 2024 at the cost of $3 billion.
“This sparked the rally but as the overall sentiment was sluggish so by end the cement makers closed with some losses, while few registered small gains,” the trader said.
The highest gainers were Sapphire Fiber, up Rs30 to close at Rs670/share, and Pakistan Suzuki up Rs13.43 to finish at Rs282.07/share.
The highest losers were Nestle Pakistan, down Rs387.50 to close at Rs7362.50/share, and Wyeth Pakistan Limited, down Rs20.09 to close at Rs862.06/share. The highest volumes were witnessed in Unity Foods Limited, recording a turnover of 7.035 million shares, whereas the scrip lost Re0.81 to end at Rs12.55/share.
(This news/article originally appeared in The News on May 3rd, 2019)