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Shares at the Pakistan Stock Exchange (PSX) on Thursday witnessed selling pressure, shedding more than 400 points in intraday trade.
The benchmark KSE-100 index declined by 468.28 points, 0.57 per cent, to stand at 81,779.63 points from the previous close of 82,247.91 points at 3:15pm.
Yousuf M Farooq, director research at Chase Securities, said, “Foreign selling from FTSE rebalancing has soaked up local liquidity.”
“IMF deal was expected and built into prices,” he added.
Yesterday, the International Monetary Fund (IMF) Executive Board agreed to loan Pakistan $7 billion to bolster its faltering economy, approving a relief package that the Prime Minister Shehbaz Sharif-led government has pledged would be the last from the Fund. Stocks had also rebounded, which analysts had attributed to expectations of an approval.
Mohammed Sohail, chief executive of Topline Securities, also attributed today’s decline to “FTSE rebalancing related selling” impacting share prices.
Financial Times Stock Exchange (FTSE) conducts an annual review which classifies country markets as “Developed, Advanced, Emerging, Secondary Emerging or Frontier” within its global equity indices.
On July 3rd, the FTSE reclassified Pakistan from Secondary Emerging to the Frontier market, stating that the country “fails to meet the Minimum Securities Count requirement for retaining Secondary Emerging market status” —with the decision being effective from September onward.
It said the decision was based on the fact that there were “less than two eligible Pakistan constituents of the FTSE Emerging Index as of the assessment date”.
More to follow
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