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business
Monday Nov 23 2020
By
Web Desk

Stocks start week on bearish note as COVID-19 lockdown speculation sends jitters through market

By
Web Desk
A mask-wearing trader stops in front of the trading screen at the Pakistan Stock Exchange (PSX) building in Karachi. Photo: PPI/Files

The Pakistan Stock Exchange started the week on a negative note on Monday, with the government's announcements hinting at another lockdown sending jitters through the market.

According to Associate Director KASB Securities Muhammad Faizan Munshey short-term investors have created selling pressure and are opting to wait and watch as the national infection rate tops 7%.

Munshey said that the State Bank of Pakistan's monetary policy was also in line with the investors' expectations, precluding the possibility of a boost from that end. He said he expects the market to remain choppy in the next few days in the absence of an immediate trigger.

"The IMF [International Monetary Fund] talks and circular debt resolution remain much-awaited catalysts," he added.

Read more: SBP maintains policy rate at 7%, says 7-9% inflation expected in 2021

The market closed on a negative note, with the benchmark KSE 100 Index losing 554 points, or 1.38%, by the end of the trading session to reach 39,632.

A look at the day's trading at the KSE 100 Index. Photo: Screengrab/PSX website

Close to 118 million shares changed hands by the end of the session, with a total worth of nearly Rs5.9 billion.

Stocks of 356 companies were traded, of which 67 gained in value, 267 declined and 22 remained unchanged.

Volumes were led by Unity Foods Ltd, with 15.4 million shares traded. Hascol Petroleum Limited (HASCOL), TRG Pakistan Limited (TRG), Worldcall Telecom Limited (WTL), and Pakistan Refinery Limited (PRL) closed out the top five symbols traded, with volumes of 15.3, 13.3m, 9.4m, and 8.6m, respectively.

Unity was down 2.53%, trading at Rs23.12; HASCOL was down 4.87%, trading at Rs13.28; TRG was down 4.54%, trading at Rs51.11; WTL was down 3.96%, trading at Rs0.97; while PRL was down 4.14%, trading at Rs16.91.

A senior manager at Topline Securities Ltd, Haris S Khan, echoed Munshey's concerns, noting the bearish trend as investors focus on growing COVID-19 cases and the government's lockdown measures.

Khan said the SBP's monetary policy had provided relief to the market and due to the measure, the benchmark index staged a brief recovery to close the day at 39,632.52.

The SBP had announced earlier in the day that it would maintain the benchmark interest rate at 7%, saying it expected inflation to fall within the previously announced range of 7-9% for fiscal year 2021 (FY21).