PSX SUMMARY: Pakistan’s stock market saw a sharp decline during early trading on Thursday following the government’s decision to terminate power purchase agreements with certain Independent Power Producers (IPPs). The KSE-100 Index fell by as much as 0.79% before managing to recover most losses and ending the day flat, closing at 85,483.40 points, a marginal gain of 30.18 points or 0.04%.
The decline was largely driven by power generation stocks, particularly Hub Power (PSX: HUBC), which fell after the company announced it had initiated a Negotiated Settlement Agreement for the accelerated expiry of its 1,292 MW power plant. Originally scheduled to expire in March 2027, the contract will now conclude on October 1, 2024. The agreement will also settle the company’s outstanding receivables up to the termination date.
Lalpir Power (PSX: LPL) also announced plans to seek shareholder approval for early termination of its contracts, further contributing to the market’s volatility. These developments followed the government’s cost-saving measures aimed at reducing its financial obligations, with a reported savings of Rs411 billion.
Market Performance
During the session, the KSE-100 Index traded within a range of 975.73 points, hitting an intraday high of 85,750.18 and a low of 84,774.45. Trading volume on the KSE-100 Index stood at 295.02 million shares.
Out of 100 companies in the index, 46 saw gains, 50 registered losses, and 4 remained unchanged.
Top Gainers and Losers
Among the top gainers of the day were:
- Atlas Honda (ATLH) (+10.00%)
- Pakistan Telecommunication Company (PTC) (+8.13%)
- Pioneer Cement (PIOC) (+7.50%)
- Pakistan State Oil (PSO) (+5.16%)
- Attock Refinery Limited (ATRL) (+3.88%)
On the other hand, major decliners included:
- Kohinoor Spinning Mills (KOSM) (-11.84%)
- Hub Power (HUBC) (-5.17%)
- Yousaf Weaving Mills (YOUW) (-4.75%)
- Allied Bank Limited (ABL) (-3.39%)
- Lucky Cement (LUCK) (-3.28%)
Sector Contributions
The KSE-100 Index was supported by gains in the following sectors:
- Oil & Gas Marketing Companies (+100.41 points)
- Fertilizer (+100.06 points)
- Commercial Banks (+62.87 points)
- Cement (+32.27 points)
- Food & Personal Care Products (+22.94 points)
Conversely, the index was dragged lower by:
- Power Generation & Distribution (-199.97 points)
- Oil & Gas Exploration Companies (-38.31 points)
- Pharmaceuticals (-21.99 points)
- Leather & Tanneries (-16.94 points)
- Chemicals (-16.67 points)
Broader Market and Volume
The All-Share Index closed at 54,537.21, up by 20.89 points or 0.04%. A total of 560.74 million shares were traded, an increase from the previous session’s 503.75 million. The value of traded shares stood at Rs26.12 billion, reflecting a decrease of Rs1.79 billion from the prior day.
Of the 434 companies traded on the Pakistan Stock Exchange, 130 closed higher, 250 ended lower, and 54 remained unchanged.
Notable Stocks by Volume
- Hub Power (HUBC) led the volume chart with 58.16 million shares traded, despite its 5.17% decline.
- Pakistan Telecommunication Company (PTC) followed with 51.35 million shares traded, posting a gain of 8.13%.
- WorldCall Telecom (WTL) saw 45.69 million shares change hands, with a 1.67% decline.
TOP 10 PSX STOCKS
Market Overview for Fiscal and Calendar Year
The KSE-100 Index has gained 7,038 points or 8.97% since the beginning of the fiscal year, while the current calendar year has witnessed a cumulative increase of 23,032 points, equivalent to a 36.88% rise, highlighting a strong performance despite recent volatility.
As the market absorbs the impact of the government’s decisions on power contracts and economic adjustments, investors are likely to remain cautious in the near term, especially in sectors directly affected by policy changes.
PAKISTAN MARKETS SUMMARY
The Pakistani rupee (PKR) appreciated by 15.29 paisa, or 0.06%, against the US dollar in Friday’s interbank session, closing at PKR 277.64 per USD, compared to the previous day’s rate of PKR 277.79. During the trading day, the PKR saw an intraday high bid of 277.85 and a low ask of 277.75, reflecting relative stability in the currency market.
In parallel, gold prices in Pakistan experienced a notable rise, with 24-karat gold increasing by Rs2,700, bringing its price to Rs273,900 per tola, according to the Karachi Sarafa Association. Additionally, the price of 10 grams of 24-karat gold surged by Rs2,315 to reach Rs234,825. The surge in local gold prices mirrors global trends as gold regained strength following the release of disappointing US jobs data.
On the international front, gold (XAU/USD) traded back into the $2,630 range after the release of US labor market data that showed signs of weakening. The report revealed a surprising spike in jobless claims, raising expectations that the Federal Reserve (Fed) will cut interest rates during its November policy meeting. This prospect is considered bullish for gold as lower interest rates reduce the opportunity cost of holding non-yielding assets like gold, making it more attractive to investors.
The labor data, combined with concerns over potential economic softening, provided a fresh tailwind for gold prices, which had been under pressure earlier in the week. A potential rate cut by the Fed could further fuel demand for the precious metal, as investors seek safe-haven assets amid economic uncertainty.
The PKR’s modest appreciation against the US dollar comes amidst an evolving global economic landscape, where central bank policies, particularly in the US, continue to influence currency and commodity markets. Meanwhile, gold prices are expected to remain sensitive to upcoming economic indicators, including inflation data and future interest rate decisions by the Fed.
As the market awaits further developments, the rupee and gold are likely to see continued fluctuations, driven by both domestic and international factors.
