Market watch: Stocks extend losses amid lack of triggers

Benchmark KSE-100 index falls 233.75 points to close at 45,059.12

KARACHI:

The stock market extended its fall on Wednesday in the absence of positive cues, though the pace of decline slowed down from the previous day.

In the morning, the benchmark KSE-100 index opened in the green, however, as an uneasy calm prevailed in the market, the index succumbed to selling pressure from exploration and production, bank and cement sectors. A lack of positive triggers kept investors cautious throughout the trading session.

A host of unimpressive financial results dragged certain sectors down while rising fatalities amid a spike in the number of new coronavirus cases triggered a sell-off.

Interest was seen in refinery and fertiliser stocks, but profit-taking in other sectors prevented the index from staying in the green.

At close, the benchmark KSE-100 index recorded a decrease of 233.75 points, or 0.52%, to settle at 45,059.12 points.

JS Global analyst Muhammad Mubashir said that the benchmark KSE-100 index opened on a positive note, touching intraday high of 45,589 points. However, profit-taking kicked in soon and the index slid to 45,020 before closing the session at 45,059.

Major profit-taking was witnessed in cement and steel sectors where DG Khan Cement (-0.5%), Lucky Cement (-0.7%), International Steels (-1.9%) and International Industries (-2.7%) closed lower than the previous day’s levels.

Investor optimism was seen in the refinery sector where National Refinery (+3.8%) and Attock Refinery (+1%) gained ground.

Total volumes decreased by 17% to 306 million shares compared to 367 million in the previous trading session.

Telecard Limited (+6.7%), Azgard Nine (+2.2%), TRG Pakistan (-1.1%), Unity Foods (-1.4%) and Ghani Global Holdings (+7.4%) led the volume charts as they cumulatively contributed 34% to the aggregate volume.

“We recommend investors to adopt a ‘buy-on-dips strategy’ in technology, cement and refinery sectors,” the analyst said.

Arif Habib Limited, in its report, stated that the market traded within a range of -272 points and +296 points. It closed the session down by 234 points.

Selling pressure was concentrated in bank, exploration and production, cement and steel sectors similar to what was witnessed on Tuesday and the absence of active buyers worsened the situation, resulting in the index closing lower than the previous day’s close.

Among technology sector stocks, NetSol performed well whereas TRG Pakistan shed value.

Service Global Footwear hit its upper circuit on the first day of listing at the stock exchange, but selling pressure brought the price down later.

Sectors contributing to the performance included bank (-93 points), exploration and production (-44 points), technology (-35 points), cement (-33 points), pharmaceutical (-29 points) and fertiliser (+30 points).

Individually, stocks that contributed positively to the index included Colgate-Palmolive (+24 points), Fauji Fertiliser (+21 points), National Refinery (+13 points), Engro Corporation (+13 points) and Pakistan Oilfields (+12 points).

Stocks that contributed negatively were HBL (-39 points), Oil and Gas Development Company (-36 points), Pakistan Petroleum (-24 points), MCB (-23 points) and TRG Pakistan (-21 points).

Overall trading volumes dropped to 305.8 million shares compared with Tuesday’s tally of 366.8 million. The value of shares traded during the day was Rs16.2 billion.

Shares of 394 companies were traded. At the end of the day, 156 stocks closed higher, 225 declined and 13 remained unchanged.

Telecard Limited was the volume leader with 29.3 million shares, gaining Rs1.03 to close at Rs16.34. It was followed by Azgard Nine with 25.6 million shares, gaining Rs0.75 to close at Rs34.77 and TRG Pakistan with 18.3 million shares, losing Rs1.93 to close at Rs177.40.

Foreign institutional investors were net sellers of Rs241.9 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.