Market watch: Bears return to PSX, KSE-100 sheds 30 points

Benchmark index dips 0.07% to settle at 40,154.11

KARACHI:

Bears staged a comeback at the Pakistan Stock Exchange on Wednesday as the benchmark KSE-100 index shed nearly 30 points amid a lack of positive triggers and an uncertain economic and political outlook.

The KSE-100 index endured a range-bound session, which ended on a bearish note. Selling pressure was noted in cement, auto, banking and fertiliser sectors.

However, Engro Corporation in the fertiliser sector, which announced its financial results for the quarter and half-year ended June 30, 2020 towards the end of the session, erased some of the losses.

Moreover, rupee depreciation against the US dollar coupled with uncertainty in international oil markets dented investors’ sentiment.

At close, the benchmark KSE-100 index recorded a decrease of 29.90 points, or 0.07%, to settle at 40,154.11 points.

Arif Habib Limited, in its report, stated that the market remained range bound between -119 points and +241 points and closed the session in the red.

Exploration and production stocks mainly added points to the index whereas cement and banking sector stocks faced selling pressure, it said.

The cement sector posted volumes of 75.4 million shares, followed by technology firms (54.5 million) and oil and gas marketing companies (40.3 million).

Sectors contributing to the market performance included fertiliser (+63 points), exploration and production (+40 points), oil and gas marketing companies (+10 points), cement (-25 points), technology (-23 points), auto (-21 points), power (-20 points) and banking (-20 points).

Volumes declined from 458.8 million shares to 427.2 million shares, down 7% day-on-day. Average traded value also fell by 10% to $110.4 million against $123.2 million a day earlier.

Individually, stocks that contributed positively to the index were Engro (+40 points), Pakistan Oilfields Limited (+18 points), Engro Fertilisers (+14 points), OGDC (+10 points) and Fauji Fertiliser Company (+10 points).

Stocks that contributed negatively included TRG Pakistan (-23 points), Hubco (-21 points), Indus Motor (-10 points), DG Khan Cement (-10 points) and Shifa International Hospitals (-8 points).

JS Global analyst Danish Ladhani said the market traded sideways with fertiliser and exploration and production stocks being the major movers whereas banking and cement sectors were the major laggards.

“In the fertiliser sector, Engro (+1.8%) announced consolidated 1HCY20 earnings per share of Rs15.73 versus Rs11.82 in the same period of last year with a cash payout of Rs8 per share,” he stated.

OGDC (+0.6%), Pakistan Petroleum (+0.6%) and Pakistan Oilfields (+1.4%) in the exploration and production sector remained in the positive zone.

Moreover, profit-taking was witnessed in Hubco (-1.1%) as the company announced consolidated FY20 earnings per share of Rs19.31 versus Rs9.37 in the same period of last year with no cash dividend, Ladhani added.

Pak Suzuki Motor Company (-4.3%) closed in the red as the company announced 1HCY20 loss per share of Rs29.92 versus loss per share of Rs18.53 in the same period of last year with no cash dividend.

“Going forward, we expect the market to trade sideways ahead of the rollover week with intra-day corrections and recommend investors to sell on strength,” the analyst said.

Overall, trading volumes declined to 427.2 million shares compared with Tuesday’s tally of 458.8 million. The value of shares traded during the day was Rs18.6 billion.

Shares of 400 companies were traded. At the end of the day, 157 stocks closed higher, 223 declined and 20 remained unchanged.

Pakistan International Bulk Terminal was the volume leader with 26.2 million shares, losing Rs0.15 to close at Rs12.36. It was followed by TRG Pakistan with 22.7 million shares, losing Rs2.13 to close at Rs49.87 and Power Cement (R) with 20.2 million shares, gaining Rs0.07 to close at Rs0.56.

Foreign institutional investors were net buyers of Rs395.9 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.