KSE-100 index sheds over 2,200pts as SBP’s MPS disappoints investors

KSE-100 Index sheds over 2,200pts as SBP’s MPS disappoints investors

KARACHI: Trading at Pakistan Stock Exchange was halted for 45 minutes in the first session of the trading on Wednesday as the KSE-100 index was down 5 per cent following the unexpected announcement regarding discount rates on last Tuesday.

This was the 5^th day, when the management of PSX halt the trading as the shares began slipping into the red.

The trading stopped at 10:17am as the bench mark index had lost 1,682 points, or 5.4 per cent to reach 30.934 points. The KSE-30 index was down 896 points or 6.26 per cent to 13.425 points.

The benchmark KSE-100 index was down 2,203 points, or 6.75 per cent, as of 2:29pm – over three hours after trading resumed. The trading close at 30,416 points.

The analysts said the market was reacting in response of monetary policy announced by the State Bank of Pakistan in which it reduced the benchmark lending rate by 0.75 per cent to 12.50 per cent, which was “clearly below market expectations”.

“The emergence of drastic headline risks pertaining to the ongoing COVID-19 outbreak in the country had moved the goal post to aggressive easing,” according to analyst.

At current levels the KSE-100 has fallen 26 per cent during the year, taking the index back to levels seen six months ago: On Sept 11, 2019, the benchmark index had closed at 30,955.

So far, significant volumes were seen in cements, commercial banks and oil marketing companies, with all sectors witnessing pressure.

Earlier this week on Monday, PSX suffered its worst single-day decline in history. Amid the mad rush to jettison shares – trigerred by the coronarvirus pandemic and the ensuing global economic slowdown – investors saw equity values hit their lower circuits.

As a result the KSE-100 index had plunged by 2,375.97 points, representing the steepest ever decline point-wise in a single day and a loss of 6.59 per cent, the heaviest one day drop in percentage terms, second only to the crash of 7.45pc witnessed on May 20, 2002. A massive sum of Rs 382 billion was wiped off the market capitalisation on Monday.