Daily Times

Pakistan stock exchange continues to battle against covid-19 pandemic and its economic fallout, as stocks continue to shed value despite series of stimulus measures by government and State Bank of Pakistan.

Domestic Stocks slumped on the last day of the session sending benchmark Kse-100 index into a negative territory, clocking at 32,806 points mark, losing 44 points or 0.14% from the previous session. The Index traded in a range of 330.24 points, showing an intraday high of 33,068.22 and a low of 32,737.98.Among other indices, the KMI-30 Index lost 185.70 points to end at 52,384.67, while the KSE All Share dropped 92.68 points, settling at 23,119.30. Of the total traded shares, 97 advanced and 181 declined.

Irfan Saeed, Senior vice president, BMA capital noted that on the contrary the market is expected to rebound in the following weeks due to multiple reasons. Mr Saeed said Government’ decision to cut profit rates on National Savings Certificate will pick up market sentiments in the following sessions, and will push fresh rally in the stocks with high yeild. According to a notification issued in this regard, the profit rate has been cut by 1.86% to 8.54% on defense certificate, and by 1.92% to 10.32% on Behbood and Pension Certificates.

The overall market volumes declined from 204.35 million in the previous session to 120.56 million shares. The volume chart was led by Hascol Petroleum Limited, followed by Maple Leaf Cement Factory Limited and Kot Addu Power Company Limited. The scrips had exchanged 14.34 million, 14.17 million and 11.98 million shares, respectively.

Sectors, that pulled down the index included Tobacco with 27 points, Oil & Gas Marketing Companies with 26 points, Cement with 22 points, Investment Banks with 13 points and Pharmaceuticals with 10 points. Among companies, the most points taken off the index was by Engro Fertilizers Limited which stripped the index of 16 points followed by Pakistan Tobacco Company Limited with 16 points, Pakistan State Oil with 16 points, Dawood Hercules Corporation Limited with 14 points and Philip Morris (Pakistan) Limited with 11 points.

During the session Oil & Gas Exploration Companies led the initial rally adding 29 points to the index. US West Texas Intermediate crude oil surged as much as 9% on Friday as investors turned back to the embattled commodity market. Contracts for June delivery traded as high as $17.95 per barrel before paring some gains later in the day. The jump follows a similar move on Thursday, marking a brief rally to close a volatile week. International benchmark Brent crude oil price, traded as much as 6.4% higher to $22.70 per barrel. Oil prices picked up the pace after US President Donald Trump’s tweet warning the US will shoot down and destroy Iranian ships threatening American vessels. Oil’s end-of-week leap can merely be a dead-cat bounce before markets descend again.

Among other sectors that tries to lift the index includes Power Generation & Distribution with 20 points, Technology & Communication with 12 points, Automobile Parts & Accessories with 9 points and Automobile Assembler with 6 points.

Global Markets: Global Stock Markets were battered on the last trading session of the week, following speculations over a failure of covid-19 vaccine. Risk sentiment took a hit late after a report in the Financial Times, citing documents accidentally published by the World Health Organization, said that drug remdesivir from Gilead had failed to improve patients’ conditions. Gilead noted that study was “terminated early due to low enrollment,” leaving it “underpowered to enable statistically meaningful conclusions. As such, the study results are inconclusive.” Major European stock markets edged lower as major benchmark lost steam. UK’s FTSE-100, CAC-40 in France and Germany’s DAX closed lower.

Asian Stocks also declined on after an overnight report that raised doubts over a potential covid-19 treatment. Shanghai composite closed 1.06% lower at about 2,808.53 while the Shenzhen composite shed 1.48% to around 1,736.93. Hong Kong’s Hang Seng index was about 0.61% lower, as of its final hour of trading. Over in South Korea, Kospi index fell 1.34% to close at 1,889.01.In Japan Nikkei 225 shed 0.86% to close at 19,262.

Meanwhile in US Wall Street struggled to keep up the pace as further 4.4 million Americans sought unemployment benefits last week as the economic toll from covid-19 pandemic continued to mount. The new applications brought the total number of jobless claims since mid-March to 26.4 million. At the highest of levels of unemployment following the 2008 financial crisis, there were 15.3 million jobless Americans. But in the past five weeks a staggering 26.5 million workers have already filed jobless claims. In just five weeks, the surge in unemployment claims has exceeded the number of jobs created in the near-decade of expansion that ended in February. International Monetary Fund has already projected US economy to contract 5.9% this year. In a bid to mitigate economic fallout of Covid-19, US government has responded to the crisis with over $2 trillion in relief, expanding eligibility for unemployment benefits and increased the payments, among other measures.