The stock market was under pressure on Monday. The first trading day of the rollover week, with the benchmark KSE-100 index falling roughly 230 points. Additionally, it has observed that Bourse falls 226 points on FATF interests as well.
The market was nervous ahead of the four-day Financial Action Task Force (FATF) plenary session. It began Monday, to assess the performance of Pakistan on the anti-money laundering and terror financing action plan.
Despite expectations that the nation will remove from the FATF‘s grey list, investors remained cautious and avoided opening new positions during the trading session.
The start of futures rollover week on Monday also prompted investors to cover their holdings. Furthermore, global market uncertainty fueled the negative trend.
The KSE-100 index began positively. It rose to an intraday high of 132 points before succumbing to widespread selling. That led by the cement and exploration and production sectors.
According to Arif Habib Limited, the market traded in a tight range of +132 points to -275 points. It ended the session with a 226-point loss.
“Uncertainty prevailed during the session due to concerns over the increase in oil prices. It would fuel inflation, as well as an increase in rupee-dollar parity. Also, it pushed investors to take a cautious approach,” the report said.
Despite an increase in cement prices, stocks in the cement and steel sectors fell. Crude oil prices were relatively steady, although the exploration and production industry faced selling pressure.
Cement (-64 points), chemical (-25 points), fertilizer (-24 points), and oil and gas marketing firms all contributed to the performance (-20 points).
Individually, Systems Limited (+19 points), FrieslandCampina Pakistan (+12 points), Meezan Bank (+6 points), Sui Northern Gas Pipelines (+6 points), and Hubco (+6 points) all contributed favorably to the index.
Lucky Cement (-33 points), Pakistan State Oil (-22 points), MCB (-20 points), Colgate-Palmolive (-15 points), and Engro Corporation all contributed negatively.
Erratic pace of KSE-100 index
According to JS Global analyst, Maaz Mulla starts on a bullish note. The KSE-100 index is unable to sustain the pace and succumbed to widespread profit-taking.
The market was under pressure for most of the first day of rollover week, falling 226 points to end at 48,012.
“Pak Suzuki Motor Company (+2.6 percent) from the auto sector rose to close higher on news that the government may extend the tax exemption for vehicles up to 1,000cc in the recently proposed Finance Bill, to encourage inexpensive cars and localization in the country,” he added.
Selling pressure was seen in the cement sector, with Flying Cement (-1.5%), Pioneer Cement (-1.9%), DG Khan Cement (-1.5%), Maple Leaf Cement Factory (-1.1%), and Fauji Cement (-1.2%) all losing ground.
Bourse falls 226 points on FATF interests. However, “In the future, we advise investors to use a ‘buy-on-dip’ approach in construction and refinery stocks,” the analyst added.
Overall trading volumes increased to 839.2 million shares, up from 750.6 million on Friday. The total value of shares exchanged that day was Rs15.9 billion.
411 shares of business have traded. By the conclusion of the day, 163 stocks had ended higher, 233 had finished down, and 15 had stayed unchanged.
Silk bank had the most volume, with 235.1 million shares traded, earning Rs0.31 to end at Rs2.14. Hum Network came in second with 60.4 million shares, losing Rs0.25 to finish at Rs8.87. While WorldCall Telecom came in third with 58.5 million shares, losing Rs0.12 to settle on Rs4.
According to statistics by the National Clearing Company of Pakistan, foreign institutional investors net bought Rs2.4 million worth of shares during the trading session.
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