Market watch: Stocks extend gains with 137-point rise

Benchmark KSE-100 index advances 0.3% to settle at 45,544.20

KARACHI:

The stock market extended its winning streak for the third consecutive day on Wednesday, supported by an increase in investor participation.

Traded value of shares at the Pakistan Stock Exchange surged to Rs50 billion – the highest in the past 13 years. Earlier, the traded value came in at Rs51 billion on February 21, 2008.

The overall optimism came on the back of some clarity following fears of a countrywide lockdown to contain the spread of the third wave of coronavirus. Moreover, easing uncertainty on the political front, coupled with encouraging current account data, strengthened investor confidence.

However, the exploration and production sector bore the brunt of declining oil prices in the international market.

At close, the benchmark KSE-100 index recorded an increase of 136.87 points, or 0.3%, to settle at 45,544.20 points.

Arif Habib Limited, in its report, stated that the market traded range bound, oscillating between -148 points and +186 points. It closed the session up by 137 points.

The exploration and production sector, which led the advance of the index the other day, remained negative on the back of an overnight decline in international crude oil prices by 7%.

On the other hand, refinery, technology and chemical sectors performed well with TRG Pakistan and Pakistan Telecommunication Company hitting their upper circuits.

Trading in banking sector stocks was muted but positive. Among oil and gas marketing companies, Pakistan State Oil (PSO) bounced back after trading below last day’s closing price for a good part of the session.

Sectors contributing to the performance included technology (+123 points), auto (+29 points), chemical (+27 points), cement (+25 points), banks (+19 points), exploration and production (-73 points), fertiliser (-20 points) and oil and gas marketing companies (-17 points).

Individually, stocks that contributed positively to the index included TRG Pakistan (+119 points), Millat Tractors (+16 points), Attock Refinery (+15 points), Pakistan Telecommunication Company (+14 points) and Hubco (+13 points).

Stocks that contributed negatively were Oil and Gas Development Company (-46 points), Engro Corporation (-29 points), Pakistan Oilfields (-14 points), Pakistan Petroleum (-13 points) and Systems Limited (-9 points).

JS Global analyst Maaz Mulla said the benchmark KSE-100 index closed with a gain of 137 points at 45,544 after touching a low and high of -148 and +186 points respectively.

Volatility prevailed in early hours, however, later value buying was witnessed. Traded value increased 16% to $164 million and volumes stood at 409 million shares, down 7% compared to the last trading session.

Major contribution to the volumes came from TRG Pakistan (+7.5%), Pakistan Telecommunication Company (+12%), Byco Petroleum (-2.2%), Hascol Petroleum (-2.9%) and Azgard Nine (+3.2%).

“On the news front, lockdowns in some cities are expected to remain in force till April 11 in view of rising coronavirus cases,” he added.

The cement sector gained ground where Pioneer Cement (+2.4%), Power Cement (+1.9%), Maple Leaf Cement (+2.1%), Cherat Cement (+1.8%) and DG Khan Cement (+0.6%) were the major movers.

The technology sector followed the same trend where Pakistan Telecommunication Company (+12%) and TRG Pakistan (+7.5%) hit their upper circuits. NetSol (+5%) and Avanceon (+3.1%) also closed significantly higher.

In the exploration and production sector, Pakistan Petroleum (-0.9%), Oil and Gas Development Company (-2.9%) and Pakistan Oilfields (-1.2%) shed value as international crude oil prices slid.

“Moving forward, we expect the market to remain volatile due to the rollover week and recommend investors to see any downside as a buying opportunity in value stocks,” the analyst said.

Overall trading volumes fell to 409.7 million shares compared with Monday’s tally of 440.99 million. The value of shares traded during the day was Rs25.6 billion.

Shares of 399 companies were traded. At the end of the day, 208 stocks closed higher, 180 declined and 11 remained unchanged.

TRG Pakistan was the volume leader with 54.6 million shares, gaining Rs10.87 to close at Rs155.85. It was followed by Pakistan Telecommunication Company with 37.2 million shares, gaining Re1 to close at Rs9.51 and Byco Petroleum with 29.2 million shares, losing Rs0.25 to close at Rs10.89.

Foreign institutional investors were net buyers of Rs631.2 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.