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Bears returned to the trading floor of the Pakistan Stock Exchange (PSX) on Monday as the benchmark index lost over 300 points on political uncertainty.
According to the PSX website, the KSE-100 index had gained 402.07 points at 11am to stand at 65,039.70 points, up 0.62 per cent, from the previous close of 64,637.63.
However, the benchmark index rapidly shed its gains by noon. It finally closed at 64,269.37 points, down 368.26 points or 0.57pc.
Shahbaz Ashraf, chief investment officer at FRIM Ventures, told Dawn.com that the momentary rally was led by “energy sector stocks on the back of news of a reduction in circular debt by about one-third in the next few weeks”.
However, he noted that the equity market remained very volatile with elections around the corner and a lot of trading activity.
“Lastly, institutional investors mainly remained on the sideline,” Ashraf said, adding that such activity at the PSX would continue until there was “full clarity on elections”.
Faran Rizvi, head of equity sales at JS Global, echoed similar sentiments. “The resolution of circular debt had influenced the uptick in activity before the index changed course,” he said.
He highlighted that political instability will continue to influence market trends and recommended that investors should stay committed to high-value markets in the future due to projected bullish trends.
Meanwhile, Raza Jafri, head of equities at Intermarket Securities, stated that the early gains were “driven by energy and bank stocks”.
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