Market watch: Stocks fall as lockdown fear rattles investors

Benchmark KSE-100 index sheds 93.24 points to close at 45,306.54


Our Correspondent April 21, 2021

KARACHI:

The Pakistan Stock Exchange (PSX) once again landed in the red on Wednesday after a day’s respite with the benchmark KSE-100 index losing over 90 points, but it managed to sustain the 45,000-point mark.

Market players took negative cue from corporate result announcements, which failed to meet expectations of investors.

In addition, anticipation of stricter restrictions by the National Command and Operation Centre (NCOC) in the wake of rising coronavirus cases fuelled the downtrend in the stock market.

On the results front, Maple Leaf Cement and Power Cement in the cement sector announced financial results while Nishat Power from the power generation and distribution sector declared its earnings for the quarter ended March 31, 2021.

Trading remained choppy for the entire day where the benchmark KSE-100 index hit intra-day high and low of 227 and 174 points.

Earlier, trading kicked off on a positive note, however, volatility emerged immediately afterwards and erased the gains. Weak investor sentiment, coupled with a lack of positive triggers, pushed the index down.

At close, the benchmark KSE-100 index recorded a decrease of 93.24 points, or 0.21%, to settle at 45,306.54 points.

Arif Habib Limited, in its report, stated that the market traded in a narrow range of -174 points and +227 points. It closed the session in the red.

Investors appeared somewhat despondent because of financial results and indifference of pertinent stocks to those results. “Moreover, hints at imposing a lockdown in major cities added fuel to the fire,” it added.

Selling pressure ensued that brought the index down, eroding gains earlier made in the session. Oil and gas marketing companies, exploration and production, cement and steel sectors bore the brunt with waning investor confidence had a bearing on technology stocks.

Sectors contributing to the performance included technology (+72 points), banks (+59 points), fertiliser (+18 points), cement (-76 points), exploration and production (-45 points) and engineering (-24 points).

Individually, stocks that contributed positively to the index included TRG Pakistan (+88 points), Engro Corporation (+37 points), NBP (+22 points), Kohinoor Textile Mills (+18 points) and Engro Fertilisers (+13 points).

Stocks that contributed negatively were Lucky Cement (-28 points), Fauji Fertiliser (-22 points), Pakistan Oilfields (-18 points), Oil and Gas Development Company (-16 points) and International Steels (-15 points).

JS Global analyst Maaz Mulla said that the KSE-100 index oscillated between the low and high of 45,226 and 45,626 points, eventually closing down by 93 points at 45,306 as pressure mounted.

A total of 388 million shares were traded during the day where TRG Pakistan (+5%), WorldCall Telecom (-6.9%), Unity Foods (-0.2%), Ghani Global Holdings (-0.7%) and Telecard Limited (+7.8%) were the volume leaders.

Maple Leaf Cement Factory (-2.6%) from the cement sector announced its 9MFY21 result, reporting consolidated earnings per share of Rs2.59. Moreover, Avanceon (+0.1%) announced full-year earnings of Rs4.82 per share for CY20 alongside 10% cash dividend and 20% bonus issue.

From the technology sector, TRG Pakistan (+5%) outperformed, closing higher than its previous day’s close.

However, cement and refinery sectors came under selling pressure as Power Cement (-3.5%), Maple Leaf Cement (-2.6%), Pioneer Cement (-1.6%), National Refinery (-3.2%), Pakistan Refinery (-1.6%) and Attock Refinery (-2.6%) closed in the red.

“As the trend continues, we recommend investors to avail any downside as a buying opportunity in cement, refinery and steel sectors,” the analyst said.

Overall trading volumes rose to 387.9 million shares compared with Tuesday’s tally of 343.3 million. The value of shares traded during the day was Rs19.3 billion.

Shares of 388 companies were traded. At the end of the day, 111 stocks closed higher, 260 declined and 17 remained unchanged.

TRG Pakistan was the volume leader with 46.7 million shares, gaining Rs8.21 to close at Rs173.22. It was followed by WorldCall Telecom with 42.9 million shares, losing Rs0.12 to close at Rs1.61 and Unity Foods with 37.6 million shares, losing Rs0.05 to close at Rs32.43.

Foreign institutional investors were net buyers of Rs651.6 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.

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