Renewed political uncertainty after the Punjab by-polls dented investor confidence at the Pakistan Stock Exchange (PSX), as the benchmark KSE-100 Index lost over 700 points by close of trading on Monday.
Investors were keen to offload their holdings as selling was witnessed across the board, pushing the benchmark index down as much as 800 points to an intra-day low of 41,274.62.
At close, the KSE-100 settled with a drop of 707.80 points or 1.68% at 41,367.11.
Investor sentiment was thrown into a frenzy over renewed political uncertainty after, according to unofficial results, Pakistan Muslim League-Nawaz (PML-N), which leads the coalition-led government, suffered a defeat at the hands of Pakistan Tehreek-e-Insaf (PTI) victory on a majority of the seats in the by-elections for the 20 constituencies of the Punjab Assembly on Sunday.
Soon after getting the results, PTI Chairman Imran Khan once again reiterated his demand to hold free and fair general elections in the country but under a credible Election Commission of Pakistan (ECP), warning that “any other path” would lead to further debacle.
Meanwhile, PML-N leader Mian Nawaz Sharif also made telephonic contact with Prime Minister Shehbaz Sharif from London and advised him to call a party’s meeting Monday to take stock of the situation. PM Shehbaz has summoned the party meeting on Monday, sources said.
“The market has reacted to the political development emerging from Punjab’s by-elections,” said Sana Tawfik, vice-president research and a senior analyst at Arif Habib Limited (AHL).
“Uncertainty pertaining to what will happen next – elections or not – is irking sentiment. Until clarity is achieved, the market will remain range-bound,” she added.
Moreover, the Pakistani Rupee depreciated nearly 2% against the US Dollar on Monday, acting as a negative trigger. The local currency closed at a record low of 215.2 in the inter-bank market.
On the economic front, inflow of workers’ remittances hit a record $31.237 billion in fiscal year 2021-22, with a growth of 6.1% compared to $29.449 billion in the same 12-month period of the previous year.
Meanwhile, volume on the all-share index inched up to 151.35 million from 140.12 million on Friday. However, the value of shares traded dropped to Rs4.36 billion from Rs5.37 billion recorded in the previous session.
WorldCall Telecom was the volume leader with 12.73 million shares, followed by K-Electric Limited with 10.31 million shares, and TPL Properties with 8.3 million shares.
Shares of 326 companies were traded on Monday, of which 55 registered an increase, 253 recorded a fall, and 18 remained unchanged.