PTBP Web Desk
The Pakistan Stock Exchange (PSX) experienced another day of substantial losses on Wednesday, with the benchmark KSE-100 Index plummeting by over 500 points during the initial trading hours. By 10:35 am, the index was recorded at 111,528.87, reflecting a decrease of 501.49 points, or a 0.45% dip from its previous close.
The brunt of this selling pressure was felt across the energy sector, particularly in oil and gas exploration companies, oil marketing companies (OMCs), power generation, and refinery sectors. Notable stocks like HUBCO, SHEL, SNGPL, MARI, OGDC, PPL, and POL all traded in negative territory, contributing to the index’s decline.
Intermarket Securities, in their market analysis note, suggested that the ongoing rollover week was a significant factor behind this continued bearish trend. They highlighted that the market was suffering from a lack of fresh liquidity, as conversions at mutual funds had slowed down, not providing the necessary capital to maintain current index levels.
The brokerage house also pointed out that the market was keeping a close watch on two major corporate results expected shortly:
FFC (Fauji Fertilizer Company), where market expectations are high for a dividend payout, with some anticipating as much as Rs35 per share, although Intermarket Securities projected a more conservative Rs24.5 per share.
UBL (United Bank Limited), where investors are also hopeful for a robust dividend announcement.
Any negative surprises from these results could further dampen investor sentiment, potentially leading to more selling.
This decline follows a similar pattern from the previous day, Tuesday, when the KSE-100 Index shed nearly 1,500 points, closing at 112,030.36. The persistent selling pressure has raised concerns among investors about the stability of the Pakistani equity market in the near term.
On a global scale, while the PSX struggled, technology stocks in the Asia-Pacific region saw gains, riding on the positive momentum from Wall Street. However, trading volumes were lighter due to the Lunar New Year holidays affecting markets in China, Hong Kong, Taiwan, Singapore, and South Korea.
Japan’s Nikkei share average managed a slight rise of 0.5%, attempting to reverse three consecutive days of losses, and Australia’s stock benchmark gained 0.8%, with technology stocks there jumping by 2.2%.
Looking towards the US, futures for the S&P 500 and Nasdaq Composite were slightly down by about 0.1%, following significant overnight gains. The tech-heavy Nasdaq had seen a sharp decline in the previous session due to concerns over competition from a low-cost Chinese AI model, impacting valuations of major US tech companies like Nvidia.
Attention now shifts to upcoming earnings announcements from tech giants like Meta Platforms, Microsoft, and Tesla. These companies’ reports will be pivotal, with investors particularly interested in how these firms plan to manage their substantial investments in computing power amidst the evolving AI landscape.
