PSX closes in red over uncertainty surrounding circular debt concerns

KARACHI: The Pakistan Stock Exchange (PSX) edged down, closing in the red on the first session of the week, falling 42.35 points or (-0.04 per cent) closing at 114,356.34 level after a volatile session over uncertainty over circular debt concerns and policy rate decision.

The market experienced a volatile session on Monday, with the benchmark index fluctuating between a peak of 650 points and a low of 246 points.

“Investors are apprehensive about the upcoming Monetary Policy Committee announcement on the policy rate decision. Additionally, uncertainty surrounding the immediate clearance of circular debt after IMF comments has put pressure on energy sector stocks,” Muhammad Awais Ashraf, Director Research at AKD Securities told Hum News English.

The Monetary Policy Committee’s announcement on the policy rate was to be announced by the State Bank of Pakistan.    

“The benchmark index closed on a relatively flat note, experiencing volatility through the session as investors remained cautious ahead of today’s MPC meeting. Market sentiment was shaped by expectations ranging from an unchanged policy stance to a potential 100 bps rate cut, keeping trading activity subdued,” Ismail Iqbal Securities note stated.

The positive market was primarily fueled by ENGROH, UBL, HBL, POL, and SRVI, which together contributed 504 points to the index. Conversely, PPL, OGDC, and PSO weighed on the market, pulling the index down by 317 points.

“The market performance was largely influenced by prevailing uncertainty surrounding the monetary policy and circular debt concerns,” stated a Topline Securities note.

Overall, market activity saw a total of 324 million shares traded, resulting in a turnover of Rs 20 billion. POWER led the volume charts with 24 million shares exchanged.

In the last session, PSX had closed on a positive note, largely driven by subdued international oil and coal prices, the benchmark index gaining 685.52 points or (6.60 per cent) closing at 114,398.69 level.