Stocks on Tuesday lost to profit-taking in overbought shares as investors hedged their bets after the surfacing of a coronavirus variant in the country, where economy remains vulnerable in the face of the second wave of the pandemic, dealers said.
Benchmark KSE-100 shares index lost 0.9 percent or 392.01 points to close at 43,282.27 points at Pakistan Stock Exchange (PSX). Ready market volume increased to 503.119 million shares, as compared with 463.412 million on Monday. KSE-30 shed 1.16 percent or 211.93 points to end at 18,001.40 points level.
Topline Securities in a note said the index opened the day on a positive note printing an intraday high of 43,912, but succumbed to selling pressure towards the end of the day.
Investors booked profits amid news reports that Pakistan had confirmed its first case of new COVID-19 variant, which was recently detected in the UK, the brokerage said.
Muhammad Saeed Khalid, head of research at Shajar Capital, said stock market remained robust earlier during the session, declining 421 points later in the day mainly due to profit-taking by mutual funds, banks, and insurance companies.
“Investors sold ahead of ECC meeting, scheduled for later tomorrow. On the other hand, participation was seen mainly in the power and textile on expectation of subsidies and relaxations for textile and power sectors,” Khalid said.
He further said the decline was also a result of aggressive selling witnessed in oil, cement, and steel stocks.
Faizan Munshey, associate director at KASB Securities, said the market suffered losses owing to year-end profit-taking after a positive opening in line with rising global indices and international oil prices.
As the session progressed, investors turned cautious given the year-end closing, Munshey added.
As many as 400 active scrips were active, of which 140 gained, 241 lost, and 19 remained unchanged.
Salman Ahmad, head of institutional sales at the Aba Ali Habib Securities said, profit hunters emerged as the index had entered an overbought zone as despite rollover, the market had closed positive last week.
“This decline is healthy as it will create room for fresh entries. Textile sector may witnessed some buying on the reports the government is expected to announce textile policy for five years soon,” Ahmad added.
Analyst Ahsan Mehanti from Arif Habib Corporation said bearish activity was witnessed in overbought stocks at the PSX amid uncertainty over economic outlook.
Early session support remained on G20 and Paris Club’s rescheduling of loans, surge in global crude oil prices, and rising foreign exchange reserves, he said.
Foreign outflow, surging power tariff, gas shortfall for industries, and investor concerns over
ongoing political uncertainty led
to a bearish close, Mehanti added.
Rafhan Maize, up Rs100 to close at Rs9450/share, and Sapphire Fibre, strengthening by Rs39 to finish at Rs1019/share were the top gainers of the day.
Bata Pakistan, down Rs40 to close at Rs1,490/share, and Otsuka Pakistan, losing Rs24 to close at Rs301/share, ended up as the main losers.
Unity Foods Limited led volumes with 41.327 million shares. The scrip gained Rs1.1 to end at Rs31.62/share.
Hascol Petrol posted the lowest turnover with 11.774 million shares, losing Rs0.03 to end at Rs14.54/share.