Market watch: Stocks record modest gains, led by banking sector

Benchmark KSE-100 index rises 85.96 points

Our Correspondent August 08, 2016
Benchmark KSE-100 index rises 85.96 points

KARACHI: Pakistan equities closed modestly higher on Monday after listless trading as interest remained selective due to lack of clarity on the direction of institutional flows.

Moreover, investors were cautious after the terrorist attack in Balochistan’s capital city Quetta where over 70 people lost their lives.

At close, the Pakistan Stock Exchange’s benchmark KSE-100 index recorded a rise of 0.22% or 85.96 points to end at 39,476.17.

Elixir Securities, in its report, said the wider market crawled sideways without any fervour after a positive open that was led by modest gains in select stocks while the benchmark KSE-100 index traded in a narrow range of 120 points.

“Index-heavy United Bank Limited (+3.6%) and Habib Bank Limited (+1.1%) contributed the most to the day’s gains and were up on reported institutional buying, however, MCB Bank (-2.6%) traded against the sector’s direction and dented index the most.”

Against the expectation, cement stocks failed to show any major sign of strength and recovery with key companies closing the day with modest gains.

“K-Electric (+0.2%) led the volumes as the stock continues to attract attention on rumours of a possible stake sale near current market levels,” said the report.

“We expect the flows-driven market to consolidate near 39,600 points while earnings and pay-out related excitement is expected to remain in selective names in the days ahead,” remarked Elixir Securities analyst Faisal Bilwani.

Meanwhile, JS Global analyst Nabeel Haroon said lacklustre activity was observed at the local bourse as the index traded between an intraday high of +110 points and intraday low of -12 points to finally close at 39,476.

“Oil and Gas Development Company (+0.89%) and Pakistan Oilfields Limited (+1.47%) in the E&P sector gained to close in the green zone, as crude oil prices surged to trade above $42 per barrel.”

“The banking sector helped the index close in the green as UBL and HBL led the gains.”

Balochistan Glass closed at its upper cap for the second consecutive day on the back of news that the company had signed an agreement with a Chinese company to manufacture and sell high-quality USP Type-1 neutral glass tubing, vial and ampoule in Pakistan.

“Engro Powergen Qadirpur Limited gained to close at its upper circuit, as the power company declared its 1H2016 result. It declared EPS of Rs3.84 per share with an interim cash dividend of Rs1.50 per share.”

“Moving forward, we expect the market to remain volatile in the absence of any major trigger,” said Haroon.

Trade volumes fell to 199 million shares compared with Friday’s tally of 263 million.

Shares of 389 companies were traded. At the end of the day, 186 stocks closed higher, 183 declined while 20 remained unchanged. The value of shares traded during the day was Rs7.9 billion.

K-Electric Limited was the volume leader with 25.7 million shares, gaining Rs0.02 to finish at Rs8.67. It was followed by Dewan Cement with 19.9 million shares, losing Rs0.31 to close at Rs16.29 and The Bank of Punjab (BoP) with 16.4 million shares, gaining Rs0.41 to close at Rs8.80.

Foreign institutional investors were net buyers of Rs719 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, August 9th, 2016.

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