The KSE-100 index underwent a volatile ride on Wednesday but managed to crawl up despite subdued investor interest.
The uptrend was fuelled by a surge in crude prices in the international market where Brent oil rose to a more than two-month high above $45 a barrel on Wednesday on hopes for an effective Covid-19 vaccine.
While the exploration and production sector posted hefty gains, stocks in the cement sector received a battering as investors expected a decline in monthly cement sales.
Earlier, trading began on a positive note, which propelled the index above 41,300 points in intraday trading. However, the momentum could not be sustained and towards the end bears wiped off some of the gains.
At close, the benchmark KSE-100 index recorded an increase of 44.27 points, or 0.11%, to settle at 41,197.32 points.
Arif Habib Limited, in its report, stated that the market traded in a range of +177 points and -253 points.
“International crude oil prices (+3.5%) helped the exploration and production sector to post hefty price gains,” it said, adding, “market’s fear of unknown that emanated from political wrangling between the opposition and the government kept the increase in the index in check.”
Cement-sector stocks faced selling pressure on expectations of a decline in monthly dispatches based on data for the first week of November.
Fertiliser, oil and gas marketing and banking stocks remained subdued due to sombre investor mood, the report added. “Overall volumes dropped over the day due to weak investor sentiment.”
Sectors contributing to the performance included exploration and production (+130 points), banks (+35 points), technology (+22 points), cement (-62 points) and power (-11 points).
Individually, major gainers were Oil and Gas Development Company (+55 points), Pakistan Petroleum (+37 points), HBL (+36 points), Pakistan Oilfields (+25 points) and TRG Pakistan (+16 points).
Major losers included Lucky Cement (-25 points), Engro Corporation (-17 points), Maple Leaf Cement (-9 points), Cherat Cement (-8 points) and K-Electric (-8 points).
JS Global analyst Maaz Mulla said the market remained volatile throughout the day, touching intraday high of +177 points and intraday low of -253 points. It closed the session at 41,197, up 44 points.
“From the exploration and production sector, Pakistan Oilfields (+2.3%), Pakistan Petroleum (+2.8%) and Oil and Gas Development Company (+3.8%) gained to close higher for the second consecutive day as crude oil prices surged in the international market,” he stated.
Profit-booking was noted in the cement sector where Cherat Cement (-2.4%), Maple Leaf Cement (-1.8%), DG Khan Cement (-1.2%), Lucky Cement (-1.3%), Pioneer Cement (-1.9%) and Fauji Cement (-1.4%) were the major losers.
Pressure was witnessed in the steel sector as well where Mughal Iron and Steel (-1.9%), Aisha Steel Mills (-1.6%), Amreli Steels (-1.9%) and International Industries (-0.9%) lost ground.
“We expect the market to remain bullish ahead, however, with uncertainties amid political noise and increasing virus cases. Hence, we recommend investors to book profit on the higher side and wait for any sharp dip to accumulate value stocks,” the analyst said.
Overall, trading volumes fell to 244.3 million shares compared with Tuesday’s tally of 355.99 million. The value of shares traded during the day was Rs8.6 billion.
Shares of 401 companies were traded. At the end of the day, 133 stocks closed higher, 247 declined and 21 remained unchanged.
BankIslami Pakistan was the volume leader with 31.5 million shares, gaining Rs0.95 to close at Rs10.74. It was followed by TRG Pakistan with 25 million shares, gaining Rs1.55 to close at Rs55.94 and K-Electric with 16.4 million shares, losing Rs0.12 to close at Rs3.57.
Foreign institutional investors were net sellers of Rs328.8 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.
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