Stocks rally despite terror attack on PSX building

Published June 30, 2020
KARACHI: A trader worries inside the Pakistan Stock Exchange after gunmen attacked the main entrance of the building on Monday. There were fewer people than normal in the compound as many employees have been working from home due to the coronavirus. — APP
KARACHI: A trader worries inside the Pakistan Stock Exchange after gunmen attacked the main entrance of the building on Monday. There were fewer people than normal in the compound as many employees have been working from home due to the coronavirus. — APP

KARACHI: The early mor­ning terrorist attack on the Pakistan Stock Exchan­­ge (PSX) in the country’s commercial hub could not un­­­ruffle investors who ref­used to be distracted by the gunfire outside. For a moment due to early commotion, some nervous participants started to sell-off and quit which pulled the index down to intraday low by 220 points.

But those who maintained their sangfroid took it as an opportunity to buy blue chips at attractive levels. The market closed at its usual time with the KSE-100 index recording gains of 242 points (0.71 per cent) and settled at 34,181.80.

The index took a turn to the north as the law enforcement agencies in collaboration with the PSX security guards quickly neutralised the last of the four gunmen who only managed to reach the compound. The benchmark hit the intraday high by 267 points.

PSX Chairman Suleiman Mehdi, who coordinated in eliminating the attackers, expressed appreciation for the security agencies’ rapid response that foiled the terrorists’ attempt to enter the multi-storeyed building. “During the whole episode, the trading at the exchange continued without a minute’s interruption as brokers, traders and the staff showed no signs of panic and went about their job,” he proudly said.

Investor interest in the equities was underpinned by the slashing of the 100 basis points policy rate cut by the State Bank of Pakistan (SBP) to 7pc last week.

“Tracing from a lower inflation outlook of 6.5pc by SBP in FY21, results of recent auctions of government securities and decline in large-scale manufacturing amid the pandemic, the decision is in line with market expectations,” an analyst said. The cumulative reduction of 625bps in three months was primarily to counter the negative impact of Covid-19 on economic activities and businesses.

The cyclicals, cement and steel, were major beneficiaries of the rate cut due to their higher leveraged positions. Buying activity was observed in banks, cement and oil and gas marketing companies (O&GMCs).

Another major gainer was the oil marketing sector as the government raised the price of petrol by Rs25.58 per litre in line with stren­gthening international rates.

Investors’ interest was also seen in the auto sector where Pak Suzuki closed at its respective upper circuit. An important event during the day was the presentation of the Federal Budget 2021 in the National Assembly, which finally received approval, set­­t­ing market’s concerns at rest.

In the heavyweight exploration and production (E&P), Pakistan Oilfields closed in the negative trajectory wher­e­as Oil and Gas Dev­­elopment Company (OGDC) and Pakis­tan Petro­leum finished in the green zone. Moreover, mixed sentiment was seen in fertiliser where Engro Cor­poration ended with gains.

Traded value declined 17pc over the previous session to $33 million while the volume stood lower by 21pc at 157m shares. Major contributions came from Hascol Petroleum, Sui Southern Gas, DG Khan Cement, Maple Leaf Cement, Hum Network and Pakistan State Oil.

Sectors contributing to the bullish performance were O&GMCs, rising by 74 points, cement 37 points, banks 35 points, autos 25 points, E&P 21 points. Top gaining scrips included Engro Corporation, up 0.1pc, OGDC 0.5pc, MCB 0.6pc, Lucky Cement 1.7pc and Pakistan Petroleum 0.8pc.

Published in Dawn, June 30th, 2020

Opinion

Casualties of war
17 Sep 2021

Casualties of war

As we ruminate over the consequences of America making a mockery of international law, it is equally important to take an inward
Love of wealth
17 Sep 2021

Love of wealth

Those obsessed with wealth are likely to be involved in corrupt practices.
Pro-rich growth
Updated 17 Sep 2021

Pro-rich growth

An intellectually honest prognosis of our political economy for the working class makes for grim reading.

Editorial

TTP amnesty?
Updated 17 Sep 2021

TTP amnesty?

An amnesty should be for some individuals, not the entire outfit.
17 Sep 2021

Media regulation

THE needless controversy over media regulation may finally be heading for a resolution. In a meeting with ...
17 Sep 2021

Refusing audit

THE continuous resistance put up by several public-sector organisations to submitting their accounts for audit by ...
Aid for Afghans
16 Sep 2021

Aid for Afghans

Humanitarian aid can resume even if the world decides to hold back on formal recognition of the regime for now.
16 Sep 2021

Wheat price

THE government’s decision to raise the wheat release price, or the rate at which provinces issue their grain ...
16 Sep 2021

Keeping the press out

ON Monday, the government yet again displayed its rising contempt for the freedom of press — this time in...