Stocks were flat on Friday amid thin participation as financial institutions virtually took a day off, while cement sector came under pressure after competition watchdog put its anti-cartelisation drive in high gear, dealers said.
Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index lost 0.25 percent or 105.14 points to close at 41,701.23 points, while ready market volumes were almost unchanged at 435.017 million shares, compared to 434.885 million on Thursday.
AA Soomro, managing director KASB Securities, said, “KSE-100 bled again and over-leverage in the market seems to be one of the reasons”.
However, in a low interest rate scenario, coupled with strong fundamentals, leverage is worth taking, he said.
“The political noise and absence of triggers kept the investors at bay, while sentiments were dampened in cement sector as talks of Competition Commission of Pakistan's renewed investigation on cartelisation of the industry dismayed the investors.”
Realistically, any eventual price hike may be slightly delayed, Soomro added.
Tracking the benchmark KSE-30 shares index also lost 0.30 percent or 52.86 points to end at 17,605.68 points level.
Muhammad Saeed Khalid, head of research at Shajar Capital, said, “Despite cash margin relaxations by the State Bank of Pakistan along with the approval of the hike in drug prices by DRAP, the index seesawed during the day mainly due to increased tension between PMLN and military officials of Pakistan”.
The benchmark index marked a high of 295 points during the day after reports that the government had decided to curtail import and custom duties on textile sector, Khalid added. Yousuf Saeed, head of research at Darson Securities, said, “Investors were cautious owing to the last day of the (futures counter) rollover week, where weak holders went on a selling spree to cover their positions”.
However, on the sector front, cement stocks were depressed following the Competition Commission of Pakistan’s raid on two premises of All Pakistan Cement Manufacturers Association in Lahore, Saeed said.
“Moreover, pharmaceutical stocks also closed on a dull note even though the government has approved up to 262 per cent increase in the prices of nearly 100 local and imported medicines in Pakistan,” Yousuf added.
Trading activity was recorded in 411 stocks, of which 161 gained, 232 lost, and 18 closed without a change.
Shahab Farooq, director research at Next Capital said, “An extremely volatile session was witnessed in the market today, where the index swung both ways and eventually closed marginally negative,” said.
Cements took the most battering after the news of a raid by competition watchdog’s raid on cement-makers association office, while general-profit taking was seen in banks in E&P sector, Farooq added.
Unilever Foods, up Rs1,040 to close at Rs15,000/share, and Nestle Pakistan, up Rs178.75 to finish at Rs6790.00/share, were the top gainers, while Murree Brewery, down Rs48.75 to close at Rs601.25/share, and Premier Sugar, losing Rs28.99 to close at Rs430.01/share, ended up as the major losers.
With 57.515 million shares, Hascol Petrol was on the top of the volumes chart and lost Rs0.83 to end at Rs21.91/share, whereas Fauji Foods Limited was at the bottom with 11.362 million traded shares, losing Rs1.04 to end at Rs27.55/share.