Market watch: Stocks end little changed as political noise continues

Benchmark KSE-100 Index edges up 43.41 points to settle at 38,525.11

KARACHI: The stock market took a breather on Tuesday as institutional investors came to its rescue late in the session.

The KSE-100 Index lost over 500 points in early trading before cherry-picking of notable index names by institutional investors which took it to an intra-day high of 38,620.66 points before settling at 38,525.11.

At the end of trading, the benchmark KSE 100-share Index registered an increase of 43.41 points or 0.11% to settle at 38,525.11.

Elixir Securities analyst Ali Raza said Pakistan equities traded volatile with the benchmark index knocking down the psychological support of 38,000 points in intra-day deals before recovering sharply to end the day in the green.

The index lost ground within first half hour of trading as the wider market barring oil stocks extended losses due to the ongoing political noise. A deadlock between the government and the opposition Pakistan Peoples Party over passage of the delimitation bill raised concerns over timely elections, which are scheduled for August 2018.



Later, value buyers entered the fray and cherry-picked index names with attractive valuations. Oil stocks stood strong as investors not only tracked gains in global crude but also currency depreciation as the rupee shed another 2% against the greenback in the inter-bank market on Tuesday. The rupee closed at 110.75 to a dollar.

This also generated interest in Hub Power (+3%) as it topped the leaders’ board and contributed most points to the KSE-100 Index.

“Despite a sharp recovery, we continue to see volatile market in the near term with political noise mainly dictating sentiments,” he added.

JS Global analyst Maaz Mulla said the PSX extended the decline with the benchmark index breaking its previous low to hit an intra-day low of -745 points at 37,737.

A recovery was witnessed later as the index touched an intra-day high of +139 points to close at 38,525.

Traded volumes were up 51% to 195 million shares while the traded value was up by 43% to $78 million.

Major leaders were Hubco (+3.03%), Habib Bank (+1.61%), Engro (+2.10%) and Pakistan State Oil (PSO, +3.25%) that cumulatively contributed +137 points to the index.

On the other hand, major laggards were DG Khan Cement (-2.21%), Lucky Cement (-0.95%), Fauji Fertilizer Company (-1.04%) and International Steels (-2.28%) that contributed -45 points to the declining index.

Pakistan Oilfields (+1.71%), Oil and Gas Development Company (+0.64%) and Pakistan Petroleum (+0.29%) all closed positive as global crude oil prices edged higher and investors awaited US inventory estimates of crude and refined products.



PSO gained on the back of news that the government had decided, in principle, to ensure simultaneous lifting of domestic and imported furnace oil for power plants to ease the strain on jet fuel supplies.

In the banking sector, mixed sentiments were seen where National Bank (+0.98%), MCB Bank (+0.34%) and Habib Bank (+1.61%) stood higher whereas United Bank (-0.45%) closed in the red.

“Moving forward, we recommend investors to stay cautious and avoid taking long-term positions unless there is clarity on the political and economic fronts,” Mulla added.

Overall, trading volumes rose to 195 million shares compared with Monday’s tally of 129 million.

Shares of 359 companies were traded. At the end of the day, 106 stocks closed higher, 235 declined while 18 remained unchanged. The value of shares traded during the day was Rs8.6 billion.

TRG Pakistan was the volume leader with 18.6 million shares, losing Rs0.42 to close at Rs31.72. It was followed by Crescent Star with 16.02 million shares, gaining Rs0.39 to close at Rs0.40 and Bank Alfalah with 13.3 million shares, losing Rs0.29 to close at Rs38.25.

Foreign institutional investors were net buyers of Rs923 million during the trading session, according to data compiled by the National Clearing Company of Pakistan.