KARACHI: Political unrest, rising gas prices, and poor corporate performance were the main causes of Monday’s volatile session on the Pakistan Stock Exchange, despite the high expectations of a sixth consecutive interest rate cut at the monetary policy review meeting later in the evening.
The main deterrent was the Economic Coordination Committee’s decision to raise the gas tariff for captive power plants by about 17%. Export-oriented players, particularly those in the textile industry, strongly reacted to this move, claiming it would reduce the nation’s export competitiveness in both regional and global markets.
The market opened favorably, according to Topline Securities Ltd., with the index reaching an outstanding intraday high of 716 points. However, bears quickly took control, so the momentum was short-lived. The index fell 1,360 points or 1.18 percent on a daily basis, hitting an intraday low of 1,398 points before closing at 113,520.
Mari Energies’ lower-than-expected financial results, which lowered investor sentiment, are mostly to blame for this downward trend. The brokerage house noted that the company’s profits per share (EPS) of Rs9.3 with no cash payment fell short of market expectations and played a major role in the bearish action that was seen throughout the trading session.
Pakistan Oilfield reported an EPS of Rs26.7 for the second quarter of FY25, bringing its 1HFY25 earnings down 42 percent to Rs35.7 per share. For 1HFY25, it did, however, announce a cash dividend of Rs25 per share.
Systems Ltd., Engro Fertilizer, Fauji Fertilizer, Pakistan Oilfield, and Bank Al-Habib are among the scrips that have positively impacted the index, adding 282 points. On the other hand, the market suffered greatly from significant drops in Mari Energies, Engro Holdings, PSO, Hub Power, and Pakistan Petroleum Ltd., which collectively lost 783 points.
The stock went bearish due to a decline in global equities and low international crude oil prices, according to Ahsan Mehanti of Arif Habib Corporation.
He went on to say that investors turned to panic selling due to uncertainty surrounding the outcome of government-PTI discussions, an anticipated cautious SBP policy decision later in the day, and concerns about the proposed Tax Laws Amendment Bill 2024, which would restrict non-filers from purchasing stock.
Consequently, the traded value fell 31.37 percent to Rs25.94 billion on a daily basis, while the trading volume fell 21.38 percent to 494.03 million shares.
