Stocks fell on Thursday as investors offloaded cement shares owing to disappointing sales data and energy stocks following easing crude oil prices, while overall sentiments ran low over concerns arising from worsening COVID-19 situation in the country, dealers said.
Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index lost 0.82 percent or 282.03 points to close at 34,119.39 points, while KSE-30 shares index shed 1.05 percent or 157.63 points to end at 14,915.41 points level.
An analyst from Topline Securities said, “Lack luster activity was observed where profit-taking was witnessed as investors remained on sidelines due to lack of positive triggers and upcoming budget 2020-21”.
Meanwhile decline in international oil prices hurt investor sentiments resultantly E&Ps (exploration and production) sector dented the index by 84 points. Of 341 active scrips, 93 up, 223 retreated, and 25 remained unchanged. The ready market volumes stood at 143.642 million shares, as compared with the turnover of 129.951 million shares in the previous session.
Sateesh Balani, director research at Ismail Iqbal Securities, said, “Equities couldn't sustain momentum as COVID-19 cases crossed 85,000 and news flows regarding tightening the lockdown kept sentiment in check”.
“Banking stocks underperformed after central bank governor suggested focus will on growth. Power sector continued to remain mixed despite news regarding government has disbursed payments via Pakistan Energy Sukuk II,” Balani said.
Salman Ahmad, head of institutional sales at Aba Ali Habib Securities, said decline in crude oil price trimmed share prices of local oil and gas sector which dragged the index down.
Concerns over the budgetary measures where the government was seen facing difficulties in raising revenue owing to pandemic situation also weighed on the stocks, Ahmad added.
Prime Minister Imran Khan has tasked his finance adviser Dr Abdul Hafeez Shaikh to convince the International Monetary Fund for slashing down the Federal Board of Revenue’s tax collection target from Rs5,103 billion to Rs4,800 billion for next fiscal year. Tahir Abbas, Head of Research at Arif Habib Ltd, said, "The pressure in commercial banks and exploration and production sector dragged the index into the minus column, while continuous selling from foreign fund houses also depressed the overall sentiment". Cement sector saw selling pressure following a substantial decline of 37 percent in sales for May mainly because of the COVID-19 halting construction activities across the country, Abbas said.
Cement sales recorded a double-digit decline for the consecutive three months in May as the lockdown and seasonal slowdown aggravated the negative effects of falling development spending.
The officials said the decline in cement despatches is mainly due to Ramzan, Covid-19 and Eid holidays which slowed the construction activity. Cement sales have so far recorded double-digit monthly decline third times this fiscal year.
The top gainers were Phillip Morris Pakistan, up Rs99.95 close at Rs1,899.95/share, and Wyeth Pakistan Limited, which gained Rs63 to finish at Rs903/share. Nestle Pakistan, down Rs200 to close at Rs6,600/share, and Indus Dyeing losing Rs44.13 to close at Rs546.02/share, were the main losers.
TRG Pakistan Limited was the volume leader with 11.319 million shares, but lost Rs0.82 to end at Rs27.18/share. Hub Power Company’s turnover was the lowest with 4.063 million shares, whereas it also shed Rs1.45 to end at Rs76.53/share.