Market watch: Stocks close flat on rising Covid-19 cases

Benchmark KSE-100 index falls 6.5 points to settle at 45,881.13

KARACHI:

Bulls and bears locked horns at the Pakistan Stock Exchange on Tuesday as the benchmark KSE-100 index oscillated between both sides of the fence due to a mixture of buying and selling pressure and finally closed the day with a marginal loss of seven points.

On the one hand, the alarming rise in Covid-19 cases in the country dented the confidence of market participants, triggering panic selling across the board. On the other hand, hopes of fresh foreign inflows coupled with corporate result announcements due this week continued to support buying activity at the bourse, mainly in the banking sector.

Earlier, the session started with a brief rally as investors resumed cherry-picking of stocks at attractive valuations, which pushed the index to an intra-day high of 46,057 points.

However, it soon started to lose ground on concerns over rising Covid-19 cases in the country, sparking profit-taking across the board. By midday, the index dropped to an intra-day low of 45,524 points.

Later, the bourse started recovering with investors taking cue from positive triggers, which helped the index erase most of the losses.

At close, the benchmark KSE-100 index recorded a marginal decline of 6.5 points, or 0.01%, to settle at 45,881.13.

A report of Arif Habib Limited stated that the market remained volatile due to a rapid increase in Covid-19 cases as in the past 10 days the positivity rate had jumped from 1.08% to 3.66%.

Profit-taking was witnessed across the board. However, a rally in the banking sector was observed due to expectation of foreign inflows, it said.

Activity continued to remain sideways as the market witnessed hefty volumes in third-tier stocks.

Sectors contributing to the performance included cement (-31 points), exploration and production (-28 points), technology and communication (-20 points), power (-10 points) and tobacco (-10 points), the report said.

JS Global analyst Neelam Naz said that the benchmark index registered profit-taking across the board and managed to close flat at 45,881, losing seven points day-on-day.

Major laggards were Systems Limited, Engro Corporation, Lucky Cement, Hub Power and Oil and Gas Development Company. Major volume leaders were WorldCall Telecom, Hascol Petroleum, TRG Pakistan, Hum Network and Telecard Limited, the analyst said.

“We believe the index can undergo a short-term correction at current levels and recommend a buy-on-dip strategy in technology, fertiliser, banking and cyclical-sector stocks,” she said.

Overall trading volumes decreased to 339.1 million shares compared with Monday’s tally of 356.97 million. The value of shares traded during the day was Rs9.7 billion.

Shares of 363 companies were traded. At the end of the day, 183 stocks closed higher, 159 declined and 21 remained unchanged.

WorldCall Telecom was the volume leader with 44.7 million shares, gaining Rs0.11 to close at Rs2.43. It was followed by Hascol Petroleum with 33.1 million shares, gaining Rs0.29 to close at Rs6.73 and Unity Foods (R) with 22.5 million shares, gaining Rs0.27 to close at Rs2.7.

Foreign institutional investors were net sellers of Rs141.3 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.