KARACHI – PSX Index Declines After Early Gains as Investors Book Profits Amid Market Caution.After a strong performance in the previous session, the Pakistan Stock Exchange (PSX) faced a setback on Wednesday as profit-taking and uncertainty caused a shift in investor sentiment. The benchmark KSE-100 index slipped by 165.26 points, closing at 139,254.36 — a drop of 0.12%.
Early Rally Fades Amid Growing Market Concerns
The trading day began on a positive note with the index surging to a high of 140,202, indicating continued bullish momentum. However, the enthusiasm quickly waned as investors began offloading positions, leading to a gradual pullback.
Market watchers pointed out that concerns about the delay in the privatization of underperforming state-run entities, currency fluctuations, rising inflation, and foreign capital outflows played a significant role in reversing market direction.
Ahsan Mehanti, Managing Director at Arif Habib Corp, attributed the decline to institutional profit-taking in overbought stocks and uncertainty surrounding economic reforms. “Volatility in the rupee, inflationary trends, and fear of capital flight contributed to bearish pressure at the PSX,” he noted.
Volatile Session Amid Futures Rollover & Earnings Season
KTrade Securities, in its market commentary, described the day as mixed, with the index initially climbing before selling pressure took over. The firm highlighted that futures rollover and the ongoing earnings season are likely to maintain market volatility in the near term.
According to KTrade, major contributors to the decline included Engro Holdings, Habib Bank, MCB Bank, and Pakgen Power, all of which dragged the index down.
Arif Habib Limited (AHL) also noted that the market couldn’t sustain levels above 140,200, falling steadily afterward. Out of the actively traded shares, 39 stocks closed in the green, while 60 declined. Notable gainers included Bank AL Habib (+1.95%), Mari Petroleum (+1.04%), and Hub Power (+0.87%), providing some support to the market. In contrast, Engro Holdings (-1.23%), Habib Bank (-1.23%), and Pakgen Power (-6.8%) were among the major losers.
PIA Privatization Update Draws Attention
Pressure was also observed in PIA Holding Company, which fell by 1.2% following reports that its potential buyer would need to invest Rs70 billion over five years as per the revised business strategy. According to AHL, pre-qualified bidders will begin site visits and expert consultations next week.
Meanwhile, the market is also anticipating the State Bank of Pakistan’s next monetary policy decision, scheduled for July 30, which is likely to influence investor behavior further.
In another development, Systems Ltd (+0.91%) announced its plans to explore potential acquisitions in the IT and IT-enabled services sector — a move that could attract fresh interest in the tech space.
Mixed Sentiment to Persist as Investors Weigh Risks
Muhammad Hasan Ather, analyst at JS Global, stated that the market witnessed a pullback after Tuesday’s strong rally. “Profit-booking dominated as investors reassessed whether the recent optimism was sustainable,” he said.
He added that mild corrections were observed in banking and oil sectors. However, clarity on fiscal policies and outcomes from ongoing talks between the Federal Board of Revenue (FBR) and business leaders could potentially improve investor confidence.
Topline Securities also reported that the market remained range-bound during the session, fluctuating between a high of 140,202 and a low of 139,105 due to rollover-related concerns. The brokerage noted that Engro Holdings, Habib Bank, Pakgen Power, MCB Bank, and Meezan Bank collectively shaved 277 points off the index. Meanwhile, Bank AL Habib, Mari Petroleum, and Hub Power added 174 points.
Trading Volumes Rise, WorldCall Leads Activity
Overall market activity remained strong, with total trading volume reaching 656.6 million shares, compared to 629 million shares traded on Tuesday. The total traded value stood at Rs32.1 billion.
Out of 483 companies that participated in trading:
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211 stocks closed higher
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243 declined
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29 remained unchanged
WorldCall Telecom led the volume chart with 55.4 million shares, rising by Rs0.08 to close at Rs1.54. It was followed by Media Times with 38.4 million shares, gaining Rs0.6 to settle at Rs3.67, and First Dawood Properties, which traded 31.3 million shares but declined by Rs0.89, closing at Rs6.75.
Meanwhile, foreign investors continued their selling trend, offloading equities worth Rs327.7 million, as per data from the National Clearing Company of Pakistan Limited (NCCPL).
Outlook
Despite Wednesday’s pullback, analysts remain cautiously optimistic. With futures rollover nearing completion and corporate earnings unfolding, the PSX may see increased fluctuations but also potential opportunities for selective buying.
The focus remains on the 140,500 level as a near-term resistance, and investors are advised to stay alert to economic developments and earnings updates in order to make informed decisions.
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