Pakistan equities closed Wednesday on a negative note with benchmark KSE-100 Index shedding 629 points, closing at 36,752 levels, down 1.7 percent.
The local bourse made a high and a low of +37 & -690 points, respectively. Market came under pressure on the lack of clarity on the economic front. Moreover, banking sector led the fall as rumors in the market were that the International Monetary Fund (IMF) has asked the government of Pakistan to withdraw all deposits from the banking sector and place them with the State Bank.
Word on the street is that one single treasury will be set up that will manage all the government money. However it’s still unclear whether the government will withdraw all the money from these banks or not, said Danish Ladhani, an equity analyst.
Bank of Punjab (BOP) losing 7.4 percent closed limit down as it holds the largest share of that money. Habib Bank Limited (HBL) (-5%), National Bank of Pakistan (NBP) (-5%) and Askari Bank Limited (AKBL) (-5%) closed in the lower circuit too.
Pressure was also felt by the Cement sector where Pioneer Cement PIOC (-5%) closed limit down. Major laggards in the aforementioned sector were Lucky Cement (-0.9%), Fauji Cement Company Limited (FCCL) (-2.4%) and Chitral Cement Company (CHCC) (-4.8%). Engro (-0.4%) and Fauji Cement Company (FCC) (-0.7%) in the Fertilizers were the major laggards.
HBL (-5%), HUBC (-2.5%), MCB (-1.2%), BAHL (-1.7%), PPL (-0.9%), OGDC (-1.3%), UBL (-1.2%) and FFC (-0.7%) were top stocks that cumulatively contributed -249 points to the negative closing.
Traded value stood at $35 million, up 4 percent and volume stood at 173 million shares, up 23 percent. Furthermore, major contribution to total market volume came from BOP (-7.4%), UNITYR1 (-38%), MLCF (-1.8%), Lotte Chemical (+1.4%) and Pak Elektron Limited (PAEL) (-2.9%). Ladhani expects market to remain choppy and volatile ahead. He recommends investors to stay cautious in the short run ahead of IMF meeting.