Selling returns to PSX, benchmark index ends week on a negative note

After days of buying momentum, selling returned at the Pakistan Stock Exchange (PSX) on Friday amid concerns around the opening of the Strait of Hormuz, with the benchmark KSE-100 Index shedding 347 points.

The market opened on a weak note, with the index slipping sharply to an intra-day low of 180,620.08, indicating early selling pressure. However, buying interest emerged soon after, allowing the benchmark to recover and briefly move into positive territory, touching an intra-day high of 181,647.27.

At close, the benchmark index settled at 181,430.02, down by 346.57 points or 0.19%.

“The negative sentiment was primarily driven by the rebound in international oil prices, prompting investors to book profits ahead of the weekend,” brokerage house Topline Securities said in its post-market report.

Among index constituents, ENGROH, UBL, MCB, EFERT, and FATIMA were the largest drags, collectively shaving 331 points off the benchmark index, Topline said.

The KSE 100 gained 3% on week-on-week basis.

“This gain can be accredited to optimism that US, Iran and Oman may announce a 60-day agreement on shipping through Hormuz,” Topline said.

In a historic development, Pakistan, Saudi Arabia and Türkiye signed the Makkah Joint Defence Agreement, committing to strengthen collective security and treat an armed attack against any one of the three countries as an attack against all.

On Thursday, PSX extended its recovery as easing geopolitical tensions, lower oil price volatility and renewed institutional buying boosted investor confidence. The KSE-100 Index gained 1,761.66 points, or 0.98%, to settle at 181,776.60 points.

Globally, Asian shares held their breath on Friday for US jobs ​data that could prove pivotal for next month’s interest-rate decision by the Federal Reserve, while rising oil prices ‌served as a reminder that Middle East tensions remain far from resolved.

MSCI’s broadest index of Asia-Pacific shares outside Japan held flat and was down 0.4% for the week. Japan’s Nikkei dropped 0.9% although it was set for a weekly rise of 1.2%.

South Korea’s KOSPI slipped 0.5% and was down 5.0% for the week ​for a seventh straight week of declines. The index had doubled in the first half of the year, swept up ​by the blistering demand for AI-linked chip stocks. China’s CSI 300 rose 0.2%.

After bouts of volatility sparked ⁠by concerns over the durability of the AI-driven rally, investors are now squarely focused on the U.S. payrolls report due later in ​the day, which could prove crucial for the interest-rate outlook. Forecasts are centred on a rise of 80,000 jobs for July after a 57,000 ​gain in June, with the unemployment rate forecast to hold steady at 4.2%.

The stakes are high as markets cannot seem to make up their mind about how the Federal Reserve might move next month, with a rate hike seen as a coin toss.

Meanwhile, the Pakistani rupee extended its marginal gains against the US dollar on Friday. The local unit closed the day at 277.71, a gain of Re0.01 against the greenback.

Volume on the all-share index decreased to 716.04 million from 793.35 million recorded in the previous close.

The value of shares declined to Rs34.10 billion from Rs40.31 billion in the previous session.

Cnergyico PK was the volume leader with 161.18 million shares, followed by B.O.Punjab with 52.33 million shares, and Wasl Mobility Mod with 24.22 million shares.

Shares of 492 companies were traded on Friday, of which 207 registered an increase, 260 recorded a fall, and 25 remained unchanged.