Market watch: KSE-100 remains flat due to lack of positive triggers

Benchmark index falls 25.6 points to settle at 34,656.12

KARACHI: The stock market experienced a range-bound session on Wednesday and closed lower by just 26 points as a lack of positive triggers prevented investors from making fresh buying.

Trading has remained choppy at the stock market for the past few days because of political tensions.

Next Capital stated in its report that a lack of positive triggers dampened investor sentiments, who were desperately on the lookout for a development that could set the market's direction.

The opposition's threat to stop the passage of federal budget 2019-20 in the National Assembly kept the benchmark index under check, it added.

Earlier, the KSE-100 index opened upwards but somber mood of investors prevented it from notching up hefty gains. In the absence of positive triggers, the market looked like a see saw as it constantly moved between red and green zones till the close of trading.

Selling pressure towards the end of the session pushed the market into the negative zone.

Automobile and fertiliser stocks remained mostly in the red while the exploration and production sector was entirely in the green.

At the end of trading, the benchmark KSE 100-share Index recorded a decrease of 25.6 points, or 0.07%, to settle at 34,656.12.

Arif Habib Limited, in its report, stated the KSE-100 index remained choppy throughout the session and traded between the day's high and low of 132.18 and 159.31 points respectively, ending with a meagre loss of 25.60 points.

"Since the beginning of this week, the bourse has remained under pressure along with thin volumes as investors stay cautious and sidelined on heightened political noise," it said.

Major stocks responsible for putting downward pressure on the index were Fauji Fertiliser (down Rs1.13), HBL (Rs0.89) and National Bank of Pakistan (Rs1.26), which cumulatively eroded 47.52 points from the index.

International Steels and Amreli Steels gained Rs0.87 and Rs1.09 respectively as both companies decided to pass the impact of rupee depreciation on to consumers.

During the session, the index found its support and resistance at 34,522.41 and 34,813.90 points respectively.

The ready market witnessed trading activity with a volume of 99.34 million shares as compared to the previous session's 104.13 million shares, registering a decrease of 4.6% with trading value at Rs3.43 billion.

Among different sectors, trading activity was mainly concentrated in cement (20.68 million shares), followed by commercial banks (17.17 million), technology and communications (15.37 million), chemicals (6.72 million) and oil and gas marketing companies (6.29 million), the report highlighted.

JS Global analyst Maaz Mulla said equities closed on a flat note, with the benchmark KSE-100 index shedding 26 points.

"The bourse kicked off trading on a positive note, hitting a high of +132 points but later it tumbled touching a low of -159 points," he said. "On the political front, opposition parties in the National Assembly rejected the Pakistan Tehreek-e-Insaf (PTI) government's budget 2019-20, urging treasury benches to implement changes that could alleviate problems of citizens."

Furthermore, measures taken by the FBR to sift over 4 million bank accounts was likely to add to the woes.

Mixed sentiments were seen in the financial sector where HBL (-0.7%) and UBL (-0.4%) remained in the red whereas MCB Bank (+1.2%) was in the positive zone.

Moreover, mixed sentiments were also seen in the cement sector where Lucky Cement (+0.2%), Fauji Cement (+1%) and Maple Leaf Cement (+0.3%) were in the green zone while DG Khan Cement (-0.2%) closed negative. Fauji Fertiliser (-1.4%) was the major laggard in the fertiliser sector.

A respite was seen in the oil and gas sector following increase in international crude oil prices. Pakistan Petroleum (+0.4%), Pakistan Oilfields (+0.5%) and Oil and Gas Development Company (+1.7%) closed in the green zone.

"We expect the market to remain choppy and volatile due to the economic and political challenges," the analyst added.

Overall, trading volumes decreased to 99.35 million shares compared with Tuesday's tally of 104.13 million. The value of shares traded during the day was Rs3.44 billion.

Shares of 316 companies were traded. At the end of the day, 136 stocks closed higher, 160 declined and 20 remained unchanged.

Maple Leaf Cement was the volume leader with 14.13 million shares, gaining Rs0.07 to close at Rs25.36. It was followed by The Bank of Punjab (XD) with 12.82 million shares, losing Rs0.26 to close at Rs9.19 and WorldCall Telecom with 9.6 million shares, losing Rs0.01 to close at Rs0.75.

Foreign institutional investors were net buyers of Rs21.1 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.