Market watch: Stocks rise as quarterly results trickle in

Benchmark KSE-100 index gains 170.75 points to settle at 46,458.13

KARACHI:

The much-awaited corporate earnings season gained momentum and generated interest in the stock market on Wednesday as the benchmark KSE-100 index rose 171 points.

The market managed to sustain the gains recorded in the previous session, however, the benchmark index kept swinging between red and green zones as companies in certain sectors announced financial results for the quarter and half year ended December 31, 2020. The bullish trend was supported by technology and cement stocks.

According to news reports, the Economic Coordination Committee (ECC) was supposed to take some important decisions during a meeting scheduled for Wednesday, which generated investors’ interest. However, the meeting was later cancelled.

Moreover, 1.5% economic growth forecast for Pakistan in the ongoing fiscal year by the International Monetary Fund (IMF) in its World Economic Outlook Update 2021 released on Tuesday impacted activity at the bourse.

Earlier, trading kicked off with a spike and the market marched upwards till midday, following which the index experienced a brief fall. The market continued to trade in a narrow range throughout the session.

At close, the benchmark KSE-100 index recorded an increase of 170.75 points, or 0.37%, to settle at 46,458.13 points.

Arif Habib Limited, in its report, stated that key decisions which were to be taken during the ECC meeting kept interest alive at the bourse with Pakistan State Oil contributing positively to the index, supported by a surge in cement sector stocks.

Technology stocks continued their uptrend, which helped the index post decent gains.

Overall, the index went up 411 points during the session but profit-booking in exploration and production and banking sectors brought the net gain to 171 points by the end of session.

Positive interest was also witnessed in the ongoing book-building of Panther Tyres, which highlighted strong investors’ sentiment.

Sectors contributing to the performance included technology (+84 points), cement (+76 points), pharmaceutical (+23 points), fertiliser (+22 points) and exploration and production (+17 points).

Individually, stocks that contributed positively to the index included TRG Pakistan (+80 points), Mari Petroleum (+25 points), Fauji Fertiliser (+23 points), Lucky Cement (+22 points) and Fauji Cement (+20 points).

Stocks that contributed negatively were Bank AL Habib (-34 points), Colgate-Palmolive (-17 points), UBL (-13 points), Pakistan Petroleum (-11 points) and Pakistan Tobacco Company (-10 points).

JS Global analyst Danish Ladhani said the KSE-100 index stayed positive throughout the day, despite the rollover week, touching intraday high of +411 points.

Total traded volume for the day came in at 611 million shares. Major contributors were Azgard Nine (+0.3%), Pakistan International Bulk Terminal (+1.9%), TRG Pakistan (+6.4%), Hascol Petroleum (+1.1%) and Fauji Cement (+5.2%), which collectively contributed 182 million shares to the total volume.

Refineries performed well as National Refinery (+7.5%) and Pakistan Refinery (+3.3%) remained in the green. On the other hand, the technology sector outshined with TRG Pakistan (+6.4%) and NetSol (+6.4%) closing in the positive zone.

“We recommend investors to take any downside as an opportunity to buy stocks,” the analyst said.

Overall, trading volumes rose to 610.9 million shares compared with Tuesday’s tally of 603.2 million. The value of shares traded during the day was Rs29 billion.

Shares of 421 companies were traded. At the end of the day, 224 stocks closed higher, 187 declined and 10 remained unchanged.

Azgard Nine was the volume leader with 40.2 million shares, gaining Rs0.09 to close at Rs32.11. It was followed by Pakistan International Bulk Terminal with 39.6 million shares, gaining Rs0.25 to close at Rs13.26 and TRG Pakistan with 37 million shares, gaining Rs7.58 to close at Rs125.97.

Foreign institutional investors were net buyers of Rs304.4 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.