Market watch: Profit-taking drags stocks back into negative zone

Benchmark KSE-100 index falls 1.50% to close at 42,268.62


Our Correspondent August 24, 2017
PHOTO: EXPRESS

KARACHI: The stock market's comeback proved to be short-lived as the index lost 642.17 points on Thursday, resuming the downtrend after a brief interlude a day earlier.

Despite remaining in the green zone and crossing 43,000 points during early hours of the trading session, investors failed to carry the momentum forward with lack of selective buying further eroding the previous day's gains.

Selling pressure in the second half further dented prices of notable index names from cement and banking sectors with DG Khan Cement and Allied Bank being the biggest losers.

Most index names in the cement sector traded at or close to their lower circuits amid lack of buying interest.

At the end of trading, the benchmark KSE 100-share Index recorded a decrease of 642.17 points or 1.50% at 42,268.62 points.

Elixir Securities, in its report, stated that Pakistan equities closed lower after the market failed to sustain gains in early trade because of lack of excitement and selective interest.

Market watch: With attractive prices, stocks bounce back

The market opened on a positive note as stocks carried Wednesday's momentum and inched upwards, pushing the index above 43,100 points.

All major sectors including cement moved higher in early trading. However, profit-taking later dragged the benchmark index into the negative territory.

The last hour saw index names extend losses with DG Khan Cement (-5%) receiving a fresh hammering to close at an 18-month low due to reported institutional selling, Elixir said.

On the results front, National Bank of Pakistan (NBP, -1.9%) closed lower after posting below-expectation earnings, while Indus Motor (-2.4%) too closed in the red despite posting higher earnings compared to street estimates.

"We expect the market to remain volatile and choppy tomorrow (Friday) with investors primarily tracking institutional flows to gauge direction," the report added.

JS Global analyst Maaz Mulla said after hitting an intra-day high of +262 points, selling pressure in the second half dragged the market down by 642 points to 42,269.

NBP (-1.85%) announced its financial results for the first half of 2017, posting earnings per share (EPS) of Rs4.02, down 9% year-on-year.

Market watch: KSE-100 maintains losing streak despite strong institutional buying

Other heavyweight stocks namely Allied Bank (-2.53%), Habib Bank (-1.32%), United Bank (-0.15%) and MCB Bank (-0.22%) also closed in the red zone in line with the falling market.

"The cement sector was a major laggard as most stocks including Attock Cement (-4.94%), Cherat Cement (-4.92%), DG Khan Cement (-5%), Fauji Cement (-3.84%), Gharibwal Cement (-4.70%) and Pioneer Cement (-4.97%) closed at or near their respective lower circuits," Mulla said.

Indus Motor (-2.44%) also announced its financial results for FY17, posting EPS of Rs165.41 and also declared a final dividend of Rs35 per share.

"In line with our expectations, the market has not been able to sustain positivity for long. We continue to recommend selling on strength," he added.

Overall, trading volumes rose to 184.6 million shares compared with Wednesday's tally of 166 million.

Shares of 392 companies were traded. At the end of the day, 99 stocks closed higher, 280 declined while 13 remained unchanged. The value of shares traded during the day was Rs10.05 billion.

Azgard Nine was the volume leader with 21 million shares, losing Rs0.62 to close at Rs15.55. It was followed by TRG Pakistan with 17.06 million shares, losing Rs2.09 to close at Rs39.9 and Aisha Steel Mills with 9.01 million shares, losing Rs0.88 to close at Rs19.47.

Foreign institutional investors were net buyers of Rs13 million during the trading session, according to data compiled by the National Clearing Company of Pakistan Limited.

COMMENTS (1)

Feroz | 6 years ago | Reply By the end of the year Trump effect could send the index to 30,000. Dollar rate likely to hit 150 as the wealthy make a rush for the exit, leaving the poorest of the poor to pay back CPEC loans of $ 100 billion. All will be done only in national interest.
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