Market watch: KSE-100 finds resistance near 50,000, ends almost flat

Benchmark KSE 100-share Index gains 15.57 points

KARACHI: The benchmark-100 index closed little changed after trading in a narrow range despite witnessing healthy activity as volumes and turnover both saw a jump of 58% and 80%, respectively.

A positive start saw the index quickly move past the 50,000-point barrier but mid-day profit-taking and disappointing results took toll on the KSE-100 that settled almost flat compared to Tuesday’s close.

At close on Wednesday, the Pakistan Stock Exchange’s (PSX) benchmark KSE 100-share Index finished with a rise of 0.03% or 15.57 points to end at 49,874.96.

According to Elixir Securities, notably, most activity was focused in sideboards and speculative plays while major sectors apart from financials and select E&Ps garnered little interest.



“Lower-than-expected earnings announcements by MCB Bank (MCB PA -2.9%) and Engro Fertilizers (EFERT PA -1.2%) resulted in both names coming under sellers’ wrath, while Cherat Cement (CHCC PA +0.3%) closed marginally up despite announcing higher than expected earnings,” said analyst Ali Raza.

“As expected, gas utilities maintained their northbound ride on Tuesday’s news of planned second gas pipeline for RLNG import; Sui Southern Gas Company (SSGC PA +5%), Sui Northern Gas Company (SNGP PA +5%),” he said.

“Moreover, steel sector came in the limelight and closed higher as investors cheered recent notice by NTC that imposed anti-dumping duties on Chinese imports of galvanised steel for a period of 5 years; International Steels (ISL PA +5%), International Industries (INIL PA +5%), Aisha Steel (ASL PA +5%),” Raza remarked.



“We see market to remain choppy in near-term with KSE-100 Index finding strong resistance at 50,000,” he added.

Meanwhile, JS Global analyst Nabeel Haroon said volatility prevailed in the market as the index traded between an intraday high of +175 points and an intraday low of -117 points to finally close on a flat note (+0.03%).

“MCB (-2.92%) in the banking sector weighed down on the index, as the bank declared its 2016 result. In its result announcement, the bank posted EPS of Rs19.67, which was lower than street estimates. This was accompanied by a final cash dividend of Rs4/share taking the full year pay-out to Rs16/share,” said Haroon.

“EFERT (-1.19%) in the fertiliser sector lost value to close in the red zone, as the company declared its 2016 result.



“In its result announcement, the company posted 40% YoY lower EPS of Rs6.98, along with a year-end cash dividend of Rs2.5/share taking the full year pay-out to Rs7/share,” said the analyst.

“Moving forward, we recommend investors to accumulate new positions on dips in the market,” he added.

Trading volumes rose to 498 million shares compared with Tuesday’s tally of 397 million.

Shares of 426 companies were traded. At the end of the day, 236 stocks closed higher, 177 declined while 13 remained unchanged. The value of shares traded during the day was Rs20.7 billion.



Lotte Chemical was the volume leader with 39.1 million shares, losing Rs0.41 to finish at Rs10.69. It was followed by Dost Steels with 37.3 million shares, gaining Rs1.00 to close at Rs15.63 and Power Cement Limited with 36.5 million shares, gaining Rs0.68 to close at Rs17.25.

Foreign institutional investors were net buyers of Rs4 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.