2017 is become worst for Pakistan’s capital market. The market fell 7.96pc during June, 3.3pc in the April-June quarter and 2.6pc in January-June. However, it managed to yield a positive return of 23.24pc in the outgoing financial year compared to 10pc in the previous year.
Trading volumes in June contracted by 24pc month-on-month to 257 million shares, whereas the traded value was down 34pc to Rs12.8 trillion.
The market performance in June, which saw the bulk of this year’s sell-off, was the worst since March 2015, as the index crashed due to a plethora of negative news, and targets and expectations that failed to materialise.
Until the end of May, the benchmark KSE-100 index continued to rally, hitting all-time highs almost on a daily basis. On May 25, the index had gained 11pc this year to reach its highest-ever level of 52,876 points.
All in all, the stock market, which had boasted a return of 46pc in 2016 — the highest in Asia and fifth best in the world — was humbled in the first half of 2017 with a negative return of 2.6pc. Barring the United Arab Emirates, China, Qatar and Russia, the PSX index has underperformed most of the regional markets.
Foreign investors remained net sellers during the first half, with the quantum growing over sevenfold as they offloaded positions worth $333m compared to $41m sell-off during the same period last year.
The Pakistan Stock Exchange (PSX) is the stock exchange of Pakistan with trading floors in Karachi, Islamabad and Lahore. PSX was reclassified as a MSCI Emerging Market in May 2017. While, the FTSE classifies PSX as a Secondary Emerging Market.
PSX was established on 11 January 2016 after the merger of individual stock exchange's of Karachi, Lahore and Islamabad. PSX's origin's where laid with the establishment of the Karachi Stock Exchange in 1947, the Lahore Stock Exchange in 1970 and the Islamabad Stock Exchange in 1992. As of may 28 , 2016, there are 560 companies listed in PSX and the total market capitalisation is $98billion.
The investors on the exchanges include 1,886 foreign institutional investors and 883 domestic institutional investors along with about 0.22 million retail investors. There are also about 400 brokerage houses which are members of the PSX as well as 21 asset management companies. PSX is among the world's best performing stock market's, between 2009 and 2015 it delivered a 26% a year. In December 2016, PSX sold 40% strategic shares to a Chinese consortium for $85 million.