Stocks extend losses as selling pressure persists

A spell of heavy selling continued at the Pakistan Stock Exchange (PSX) on Monday, which extended last Friday’s sharp losses of over 3,700 points, as investor sentiment remained subdued over domestic uncertainties and geopolitical concerns.

At close, the benchmark KSE-100 index recorded a loss of 1,789.20 points, or 0.97%, and settled at 182,340.38. Earlier, the KSE-100 opened on a positive note but selling pressure quickly resurfaced, erasing initial gains. Broad-based selling was witnessed across key sectors, including power, cement, commercial banks, oil and gas exploration and oil marketing. The index recorded intra-day high of 185,651 and low of 180,993.

In major news, Finance Minister Muhammad Aurangzeb stressed that Pakistan remained on track to better manage public debt by extending maturities, reducing servicing costs and making early repayments. On the other side, Moody’s downgraded its outlook on Pakistan’s banking sector from positive to stable.

Index-heavy stocks such as Oil & Gas Development Company, Pakistan Petroleum, Pakistan State Oil, Sui Southern Gas Company, Habib Bank, Meezan Bank and National Bank traded in the red.

Arif Habib Limited (AHL) reported that stock selling continued in the first session of the week following Friday’s sharp sell-off. The KSE-100 recorded a decline, with heavyweights – Oil & Gas Development Company and Pakistan Petroleum – acting as major drags. Meanwhile, the government announced plans to boost its intelligence network and deploy a special force to protect the mineral-rich Balochistan. Technical analysis indicates that the index needs to move above 187k to mitigate the threat of a downside breach, AHL noted.

KTrade Securities wrote that the PSX once again closed on a negative note, where the KSE-100 settled at 182,340, down 1,789 points. Market sentiment remained weak as investors were cautious amid domestic uncertainties and external geopolitical concerns.

Trading activity stood healthy at 597 million shares. However, selling pressure was broad-based, reflected in weakness across commercial bank, oil & gas, cement and power sectors. Key index drags were OGDC, Meezan Bank, PPL, Hub Power, Askari Bank and Lucky Cement, it said.

On the corporate front, Askari Bank hit the lower limit (-10%) after announcing a lower-than-expected dividend. Looking ahead, US-Iran tensions, security concerns particularly in Balochistan, potential delay in the Reko Diq project and earnings-related developments are likely to keep the market range bound in the near term, KTrade added.

Topline Securities observed that the KSE-100 index closed in the red, marked by heightened volatility. The index oscillated between the intra-day high of 185,651 and low of 180,993, before settling at 182,340, down 1,789 points.

The index was largely pressured by heavyweight decliners, with OGDC, Meezan Bank, PPL, UBL and Lucky Cement collectively erasing 932 points. The losses were partially offset by gains in select names, including Sazgar Engineering, MCB Bank and Nestle, which added 221 points, Topline said.

Overall trading volumes decreased to 931.4 million shares from previous tally of 1.27 billion. The value of shares traded during the day stood at Rs58.9 billion.

Shares of 481 companies were traded. Of these, 161 stocks closed higher, 278 dropped and 42 remained unchanged.

K-Electric was the volume leader with trading in 302.4 million shares, gaining Rs0.48 to close at Rs9.42. It was followed by The Bank of Punjab with 53 million shares, losing Rs0.39 to close at Rs39.70 and Agha Steel with 47 million shares, rising Rs0.34 to close at Rs8.98. Foreign investors sold shares worth Rs1.02 billion, the National Clearing Company reported.