Market watch: Petroleum price hike pulls stocks down
Shares of 339 companies were traded. At the end of the day, 135 stocks closed higher. PHOTO: REUTERS
The Pakistan Stock Exchange on Wednesday experienced a tumultuous session as the KSE-100 index traded on both sides of the fence and closed the day on a negative note.
A massive increase in petroleum prices by the government impacted investor sentiment, which kept trading in a narrow range.
As inflation reading was expected to increase further in the wake of oil price hike, market participants resorted to dumping their stockholdings.
Index-heavy automobile, cement, bank and oil sectors bore the brunt of weak investor spirits as they closed mostly in the red.
Earlier, trading began with a spike but the market was unable to sustain the uptrend, erasing all gains by midday. From that point onwards, the KSE-100 index began falling, however, late session buying wiped off some of the losses.
At close, the benchmark KSE-100 index recorded a decrease of 46.9 points, or 0.1%, to settle at 45,684.80 points.
JS Global analyst Waqar Iqbal said that the stock market remained range bound where the KSE-100 index closed at 45,685, losing 47 points day-on-day.
“Government’s decision to increase petroleum prices has created a perception that inflation readings will be high in the coming months,” he said.
Major volume leaders of the day were K-Electric, WorldCall Telecom, Faysal Bank, Hum Network and the Bank of Punjab.
“Going forward, the market is expected to remain range bound, where we believe the trend will depend mainly on key macro indicators,” the analyst said.
In its report, Arif Habib Limited stated that the market witnessed another range-bound session due to inflationary concerns arising from higher fuel prices.
The KSE-100 index opened trading on a positive note but closed the session with a drop of 47 points.
“In the cement sector, Pioneer Cement remained under pressure despite its financial result being in line with market expectations,” it said.
“Mainboard activity remained dull. In the last trading hour, investors opted for profit-taking, which led the market to close in the red zone.”
Overall trading volumes fell to 145.3 million shares compared with Tuesday’s tally of 274.6 million. The value of shares traded during the day was Rs4.1 billion.
Shares of 339 companies were traded. At the end of the day, 135 stocks closed higher, 181 declined and 23 remained unchanged.
K-Electric was the volume leader with 23.6 million shares, gaining Rs0.06 to close at Rs3.59. It was followed by WorldCall Telecom with 17.1 million shares, gaining Rs0.06 to close at Rs2.02 and Faysal Bank with 10.1 million shares, gaining Rs0.1 to close at Rs27.
Foreign institutional investors were net sellers of Rs32.97 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.