PSX gives up early gains, succumbs to profit-taking

KSE-100 index loses 476 points in ongoing consolidation phase

KARACHI:

The Pakistan Stock Exchange (PSX), after kicking off the new trading session on an upbeat note on Wednesday, gave up early gains over profit-booking pressure. By the close of trading, the benchmark KSE-100 index recorded a loss of 476 points, or 0.32%, at 146,529.

In the morning, stocks showed impressive movement, which took the index to intra-day high of 147,892. After midday, the market gradually began to lose steam as traders grew increasingly risk averse. It resulted in a steady pullback, pushing the index to the day’s low at 146,418.

Arif Habib Limited (AHL) Head of Research Sana Tawfik told The Express Tribune that the stock market started off on a positive note but lost momentum due to profit-taking and closed lower. “As expected, it is a consolidation phase following a long streak of record-breaking rallies,” she said.

“However, the sentiment is expected to turn positive in the backdrop of several factors such as Moody’s rating upgrade for Pakistan to Caa1 from Caa2 and robust corporate results. Profit-taking is also expected to continue simultaneously,” she added.

In its report, AHL wrote that the KSE-100 slipped below the 147,000 level ahead of the August 14 holiday. Some 38 stocks advanced while 61 declined, where Lucky Cement (+2.25%), Habib Bank (+1.71%) and National Bank (+3.58%) contributed the most to index’s advance. On the other hand, Engro Fertilisers (-3.04%), Pakistan Petroleum (-2.08%) and Mari Petroleum (-1.23%) were the biggest drags, it said.

In a positive development, AHL mentioned, Moody’s upgraded Pakistan’s rating to Caa1 from Caa2, supported by improving external buffers, fiscal consolidation and reform progress under the International Monetary Fund (IMF) programmme. The credit outlook was revised to stable from positive.

KTrade Securities, in its market wrap, noted that the KSE-100 index remained range bound as investors continued to take profit. The index lost 476 points and closed at 146,529 after hitting intra-day high of 147,892 and low of 146,418. Cement stocks performed positively while fertiliser and oil and gas sectors lost ground, it said.

Key gainers included Lucky Cement, Habib Bank, Meezan Bank and National Bank. On the flip side, Fauji Fertiliser, Engro Fertilisers, Pakistan Petroleum and MCB Bank pulled the index down.
The uptrend may continue, however, some consolidation is likely as the index hovers around record highs, KTrade concluded.

Topline Securities commented that after a strong start, the bourse could not sustain its early momentum. The session opened on a positive note, with the index surging to intra-day high of 886 points. However, the gains were short-lived as bears gradually took control, dragging the index to intra-day low of 587 points, before settling at 146,529, down 476 points, it said.

The move reflected not a deep bearish shift, but rather a mild spell of profit-taking following the recent rally, Topline added.

Overall trading volumes decreased to 647.1 million shares compared with Tuesday’s tally of 691.7 million. Traded value stood at Rs40.9 billion.

Shares of 487 companies were traded. Of these, 199 stocks closed higher, 240 dropped and 48 remained unchanged.

Yousuf Weaving was the volume leader with trading in 51.8 million shares, gaining five paisa to close at Rs6.14. It was followed by Aisha Steel Mills with 48.6 million shares, rising 74 paisa to close at Rs12.92 and The Bank of Punjab with 33.8 million shares, up nine paisa to close at Rs14.26. Foreign investors sold shares worth Rs594.2 million, the National Clearing Company reported.