The KSE-100 fell about 300 points at the PSX on Friday after a second-session decline, completing the week in negative territory because of a worsening current account deficit, which totaled nearly $1.5 billion in August 2021.
The benchmark KSE-100 traded lower after climbing to 47,000 in the first session, losing all of its gains to drop back to 46,500. In the first session, the index reached an intraday level of 47,183.08. Despite the drop, the KSE-100 completed its day trading at 46,636.08, up from 46,339.72. The index dropped 1.19% for the week.
Investors were dissatisfied with the current account deficit numbers, which have additionally placed the rupee under pressure recently. Investors took profits in anticipation of the State Bank of Pakistan announcing its monetary policy on Monday.
Because of interest rate uncertainty, the KSE-100 has remained volatile lately. But, the market has already priced in a 25-basis-point interest rate increase, based on 3M KIBOR rising 14 basis points in the past 10 days and the consolidation of the market, and so, an increase will not be seen as negative in the near term.
Moreover, it is highly unlikely that interest rate hikes will have a material impact on the profitability of most companies, as they have already received subsidised financing. Therefore, the market’s near-term direction is likely to be influenced by the IMF review, which is expected to begin in late September, and the FATF meeting, which will take place in October.
In the financial sector, Pakistan Petroleum Ltd (PPL) recorded a net profit of Rs14.3 billion and an EPS of Rs5.26 during the fourth quarter of the fiscal year (FY) 2021. With the dividend payment, the business also announced a cash distribution of Rs2.00/share.
The benchmark KSE-100 index was dragged down by the cement sector (down 73.45 points), the banking sector (down 58.49 points), and the technology and communication sector (down 48.79 points) (57.02 points) on Friday.
The total number of shares on the all-share index declined from 405.18 million to 387.29 million from Thursday to Friday. During the day, the value of shares traded dropped slightly, from Rs16.51 billion to Rs16.24 billion.
WorldCall Telecom, which accounted for 42.41 million shares, was the volume leader, followed by TRG Pakistan Limited (25.23 million shares) and Byco Petroleum (20.91 million shares).
Over the course of Friday, an estimated 525 firms’ shares were exchanged, with 173 of them increasing in value, 327 falling, and 25 staying flat.