IMF-driven PSX rally fizzles amid geo-political concerns

KSE-100 gains over 672 points in early trade; slumps over 900 points by midday as investors resort to profit-taking

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A stock broker reacts while monitoring the market on the electronic board displaying share prices during trading session at the Pakistan Stock Exchange, in Karachi on July 3, 2023. Photo: Reuters/ File

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KARACHI:

Pakistan equities witnessed a volatile session on Wednesday as early optimism at the Pakistan Stock Exchange (PSX) gave way to selling pressure amid rising geo-political concerns.

The benchmark KSE-100 Index opened on a positive note and displayed resilience during early trading hours, gaining as much as 672.16 points by 9:45am.

Buying activity was observed across key sectors, including automobile assemblers, cement, commercial banks, oil and gas exploration companies, OMCs, power generation and refinery stocks.

The initial rally was largely driven by the State Bank of Pakistan’s announcement that it had received $1.3 billion from the International Monetary Fund (IMF) under the Extended Fund Facility (EFF) and Resilience and Sustainability Facility (RSF) programmes, boosting investor confidence.

However, the momentum proved short-lived as geo-political jitters dampened market sentiment, prompting investors to resort to profit-taking and offloading positions.

As a result, the KSE-100 index slipped into the red zone and was hovering at 168,015.09 points, down 902.33 points, or 0.54%, with traded volume standing at 148.70 million shares and total traded value at Rs8.95 billion.

Trading remained underway at the time of filing this report, with investors closely monitoring developments on both the economic and geopolitical fronts.

Read: PSX ends lower amid choppy trading

On Tuesday, PSX witnessed a mixed yet largely negative session as investors remained cautious amid geopolitical uncertainty surrounding US-Iran peace negotiations.

After commencing trading on a firm footing, the benchmark KSE-100 index moved higher in early trade as renewed buying interest pushed the market to the intra-day high of 171,571.56 points. The momentum, however, proved short-lived, with investors resorting to profit-taking and dragging the index into negative territory during the latter half.

Subsequently, the index slipped to the intra-day low of 168,823.32 before closing at 168,916.22, down 1,590.09 points, or 0.93%.

Overall trading volumes decreased to 1.02 billion shares against Monday's total of 1.10 billion. The value of shares traded during the day stood at Rs32 billion. Shares of 485 companies were traded. Of these, 106 climbed, 346 fell and 33 remained unchanged.

Cnergyico PK was the volume leader with trading in 154.1 million shares, gaining Rs0.15 to close at Rs8.81. Foreign investors bought shares worth Rs280.4 million, the National Clearing Company reported.