KARACHI: After briefly hitting a new all-time high above the 73,000 level in early trading on Monday, the stock market failed to extend an overnight bull run and closed in the red amid uncertainty about a rate cut ahead of the monetary policy announcement.
Ahsan Mehanti of Arif Habib Corporation said the market witnessed an across-the-board selling spree on expectations for prudent SBP monetary policy with risks ahead to resolve circular debt crises, reforms on tax rates, fiscal consolidation and geopolitical noise.
He said institutional profit-taking in selected overbought stocks and likely structural reforms for the IMF’s new programme to end subsidies in the energy, fertiliser, and gas sectors also contributed to bearish sentiment.
Topline Securities Ltd said equities began the week on a mixed note ahead of two key events scheduled later in the day: a monetary policy review and the IMF’s board meeting to approve the last tranche under the $3bn Stand-By Arrangement.
Street view was scattered almost 50/50 between ‘no-change’ and 50-100bps cut. Moreover, IMF’s Executive Board will likely approve the $1.1bn tranche as Pakistan reached a Staff-Level Agreement last month following a successful review.
Continuing last week’s buoyant momentum, investors built up positions in selected shares, tossing the KSE 100 index to new highs but profit-taking at the day’s highs compelled the benchmark index to shed earlier gains.
Power, fertiliser and E&P sectors contributed to the sell-off the most where Hub Power, Engro Fertilisers, Fauji Fertiliser, Oil and Gas Development and Mari Petroleum wiped 497 points from the index.
However, Fauji Fertiliser Bin Qasim Ltd, National Foods and Highnoon Laboratories Ltd cumulatively added 71 points due to some buying interest witnessed in them.
As a result, the index hit an intraday record high of 73,300.75 and a low of 71,764.18. However, it closed at 71,695.03 points after losing 1,047.71 points, or 1.44pc, from the preceding session.
Published in Dawn, April 30th, 2024
Dear visitor, the comments section is undergoing an overhaul and will return soon.