KARACHI: The stock market on Wednesday failed to show any significant gains amidst the adverse economic effects of the coronavirus crisis and the ongoing lockdown.
The government has extended a nationwide lockdown for two more weeks but allowed the partial resumption of business activities for several sectors. This was expected to resume economic activity with the opening of the agriculture and construction sector along was allied industries.
However, this failed to have any significant impact on the stock market as investor confidence remained subdued due to the worrying signs of a recession and economic slump. The benchmark KSE 100 index shows a paltry gain of just 19.45 points and closed at 31,242.19 points. There was an upward rally in the opening hours by 558.69 points but all gains were erased before trading was suspended. The total volume of shares was 145.428 million valued at Rs6.59 billion.
Meanwhile, the lower bench KSE 30 index declined by 55.18 points (0.40%) and closed at 13,761.43 points. The total volume of shares was 91.248 points. The top active stock which show a rise in share prices included MLCF (0.13%), FCCL (2.51%), PIOC (4.88%), DGKC (1.74%), KEL (1.43%), Unity (0.78%), and EPCL (6.26%).
There was increased investment in the cement sector as the government allowed the resumption of the construction sector and allied industries. Prime Minister Imran Khan has also announced to introduce an ordinance to provide massive relief to the construction sector to provide employment opportunities.
Investor confidence was subdued after reports emerged that the International Monetary Fund (IMF) forecasted a negative 1.5 percent growth rate for Pakistan this year. The growth rate will shrink as compared to 3.3 percent growth in the 2018-19 fiscal year, according to the Global Outlook report released earlier.
The global economy is also expected to contract by three percent in 2020, much worse than the 2008 financial crisis, and will experience the worst recession since the depression. The World Bank has also warned that South Asia will see the worst economic slowdown in forty years and the region could be the next hotspot for the coronavirus.
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