Market watch: KSE-100 starts FY20 with 95-point gain

Benchmark index increases 0.28% to settle at 33,996.33

KARACHI: The stock market endured a dull session amid range-bound trading on Monday but the KSE-100 index still managed to close first day of the new fiscal year with a gain of 95 points.

News reports of Pakistan receiving the first tranche of $500 million from Qatar failed to excite investors, who preferred to stay cautious, said M Faizan of Next Capital.

According to him, Pakistan was believed to have accepted stringent demands under the International Monetary Fund (IMF) bailout package, which reflected poorly on the stock market. Thin volumes restricted the market from making any significant gains.

Earlier, trading began on a positive note but the index entered the negative territory by midday and remained there for a substantial part of the session. Late session buying helped the market recover and close with modest gains.

The cement sector came under pressure during the day and majority of the stocks remained in the red.

At the end of trading, the benchmark KSE 100-share Index recorded an increase of 94.75 points, or 0.28%, to settle at 33,996.33.

JS Global analyst Maaz Mulla said KSE-100 index movements were similar to a seesaw, where the bourse fluctuated between green and red zones and closed at 33,996 points, up 95 points.

"Total volume was recorded at 48 million shares, down 78% from Friday," he added. Unity Foods (+5.6%), TRG Pakistan (+0.1%) and Maple Leaf Cement (-1.8%) led the volumes with almost 18 million shares changing hands.

On the news front, Adviser to Prime Minister on Finance Dr Abdul Hafeez Shaikh during a press conference on Sunday said the government had decided to extend the deadline for the Asset Declaration Scheme to July 3.

Most cement stocks remained in the red, particularly DG Khan Cement (-1.6%), Maple Leaf Cement (-1.8%), Pioneer Cement (-0.8%) and Lucky Cement (-0.8%), which stood lower than their previous day's close.

Mixed sentiments were witnessed in the banking sector where HBL (+1.7%), NBP (+5%) and UBL (+0.8%) moved up and on the flipside MCB Bank (-1.3%) and Meezan Bank (-1.1%) lost ground.

"Moving forward, we expect the market to remain volatile until the IMF meeting is held (on July 3). We recommend investors to buy on dips," the analyst added.

Aba Ali Habib Securities, in its report, stated that investors endured a dull trading session, where the index traded within a narrow range while volumes declined significantly.

"Market participants adopted a wait and see approach ahead of the IMF executive board meeting due on July 3."

In terms of sectors, trading activity was mainly concentrated in vanaspati and allied industries (13.90 million shares), followed by commercial banks with volumes of 5.09 million shares, cement (4.43 million), oil and gas marketing companies (2.87 million) and technology and communications (2.77 million), the report said.

Overall, trading volumes decreased to 48 million shares, down 77.56% compared with Friday's tally of 213.9 million. The value of shares traded during the day was Rs1.77 billion.

Shares of 314 companies were traded. At the end of the day, 155 stocks closed higher, 140 declined and 19 remained unchanged.

Unity Foods was the volume leader with 13.9 million shares, gaining Rs0.58 to close at Rs10.88. It was followed by TRG Pakistan with 2.1 million shares, gaining Rs0.02 to close at Rs16.38 and Maple Leaf Cement with 1.8 million shares, losing Rs0.42 to close at Rs23.47.

Foreign institutional investors were net buyers of Rs161.12 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.