Stocks make U-shaped recovery, close flat

KARACHI:

Pakistan Stock Exchange had a topsy-turvy trading session on Thursday as the benchmark KSE-100 index made a U-shaped recovery to wipe out the losses and close on a flat note.

A persistent rise in Covid-19 cases all over Pakistan dealt a blow to investor interest and they resorted to offloading their stockholdings.

The resumption of rupee’s slide against the US dollar added to the market’s woes, triggering across-the-board stock selling.

Moreover, market players remained cautious ahead of the monetary policy announcement, scheduled for Monday.

Although the market usually has a mixed reaction to the change in interest rate, the investors still rushed to safeguard their positions.

Earlier, the trading began with a dip as the index fell over 500 points in early hours.

The bourse posted a rebound towards midday after market players cherry-picked the stocks that had fallen to attractive valuations.

The buying spell accelerated in the last hour, which helped erase almost all the losses.

At close, the benchmark KSE-100 index recorded a decrease of 7.46 points, or 0.02%, to settle at 44,825.97.

A report of Arif Habib Limited stated that a bearish momentum was witnessed at the bourse due to an alarming rise in Covid-19 cases and higher international oil prices.

The market opened on a bleak note and stayed in the red zone throughout the day. Mainboard activity remained gloomy, it said.

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On the flip side, the activity continued to remain sideways as the market witnessed hefty volumes in third-tier stocks, it said. In the last trading hour, across-the-board buying was observed as short-sellers jumped in to square off their positions, the report said.

JS Global analyst Neelam Naz said that the benchmark index managed to close almost flat at 44,826, losing just 7 points day-on-day.

Traded volumes stood at 254 million shares with WorldCall Telecom (+0.9%), Cnergyico (-1.7%), Ghani Global Holdings (-0.6%), Telecard Limited (+3.3%) and K-Electric (-1.9%) being the highest contributors.

The index recovered after touching the low of 44,275 as buying was witnessed in heavyweights such as Kapco, HBL, Bank AL Habib and Pakistan Petroleum.

“Going forward, we recommend investors to book profit in the range of 45,000 to 45,300 points and wait for the dust to settle before taking further buying positions,” the analyst said.

Overall trading volumes increased to 254.2 million shares compared with Wednesday’s tally of 236.9 million. The value of shares traded during the day was Rs7.7 billion. Shares of 348 companies were traded.

At the end of the day, 169 stocks closed higher, 158 declined and 21 remained unchanged. WorldCall Telecom was the volume leader with 27.9 million shares, gaining Rs0.02 to close at Rs2.18. It was followed by Cnergyico Pk with 18.8 million shares, losing Rs0.11 to close at Rs6.4 and Ghani Global Holdings with 17.5 million shares, losing Rs0.12 to close at Rs20.48.

Foreign institutional investors were net sellers of Rs42.3 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.