KARACHI – The stock market in the outgoing week kept struggling for its sustainability as confusion and uncertainty surrounded potential investors due to the rout in global equities. Economists fret over sharper than expected downturn in world economies as the novel coronavirus outbreak continues to invade countries.
Other persisting factors, including the suspension of imports from China and adverse affects on the Asian economy have restricted the stock market to grow. Investors this week continued to dump stocks and plough their money in safe haven assets, mainly gold.
Altogether, the Pakistan Stock Exchange’s (PSX) benchmark KSE 100-Share Index obtained only 236.05 points on a weekly basis as last Friday the Index closed at 37,983.62 as compared to yesterday’s 38,219.67.
On Friday, the Index tumbled 1,162.44 points (2.95 percent) while wiping out Rs186 billion from paper value of corporate Pakistan. Foreigners in Pakistan capital market continued to sell off scrips valued at $2.29 million, taking the one-month outflow to a staggering $60m.
On Thursday, the PSX observed bullish trend and closed at 39,382.11 with a positive change of 475.71 points (1.22%).
On Wednesday, the stock market dropped 293.28 points and reached 38,906.40.
On Tuesday, the KSE-100 Index lost 96.62 points and settled at 39,199.68. A total of 225,275,610 shares were traded whereas the value of shares traded during the day stood at Rs8.763 billion.
On Monday, stocks rebounded with the Index jumping 1,312.68 points or 3.34 percent. The value of shares rose by Rs190 billion which is a gigantic leap in shares’ value in one day after May 2019. At close on Monday, the index settled in the green at 39,296.30.
On the first trading day of the week, the momentum was generated in the market as investors continued to relish windfall gains to the economy in the form of declining oil prices; squeeze in trade deficit by 27pc during 8MFY20 and lower-than-expected inflation numbers for February over the earlier month, raising hopes of an early cut in interest rates by the State Bank of Pakistan (SBP).
The positive change was also supported by the decline in certain inflation rates and positive effects of the Afghan peace deal in the region.
In the local market, the two heavyweight oil and gas exploration scrips – Oil and Gas Development Company and Pakistan Petroleum – were seen closing near their lower circuit breakers.
According to experts, the stock market has been searching for a proper direction for healthy growth but several factors continue to dominate the sentiments of potential investors.