PSX falls on profit-taking, trims losses on loan deals

Stocks fell on Wednesday as investors booked profits and remained cautious ahead of the general elections next year, but the market trimmed some losses in late trade on positive news from international lenders, dealers said.

The Pakistan Stock Exchange's (PSX) benchmark KSE 100-share Index fell by 385.02 points or 0.61 percent to close at 62,448.01 points. The KSE-30 index also decreased by 108.52 points or 0.52 percent to close at 20,893.76 points.

The highest index of the day remained at 63,261.05 points while the lowest level was recorded at 61,082.50 points.

Analyst Ahsan Mehanti at Arif Habib Corp, said pressure continued on pre-election uncertainty. “Late session recovery was witnessed on reports of World Bank approval on $350 million financing under RISE-II and $1.2 billion ADB loan deals for budget financing.”

Mehanti said investor concerns for high leverage and high leverage cost at the PSX also played a catalytic role in the bearish close. Traded shares decreased by 326 million shares to 1.187 billion shares from 1.187 billion shares. The trading value decreased to Rs26.038 billion from Rs29.099 billion. Market capital dropped to Rs9.027 trillion against Rs9.093 trillion. Out of 362 companies active in the session, 107 closed in green, 246 in red and 9 remained unchanged.

Analyst Ali Najib at Topline Securities said equities had a recovery day on Wednesday. “The tale of the day spread over two halves … the first one with a strong bearish rampage, simply a continuation of Tuesday’s selling spree and the latter one provided some sigh of relief where courageous value hunters’ cherry picking helped the benchmark index to gain earlier lost grounds,” he added.

“The reason for Wednesday’s market action remained intact as continuous profit-taking and deleveraging of equity positions by investors ahead of the calendar year-end kept market sentiments subdued in the early trading hours,” he said. “However, the attractive valuation of blue-chip stocks could not keep value hunters at bay which translated into buying interest at the day’s low.” Subsequently, the power, E&P and fertiliser sectors received considerable buying interest where HUBC, MARI, KEL, PPL and EFERT positively contributed 179 points to the index. On the flip side, ENGRO, OGDC and LUCK witnessed selling headwinds as they lost 155 points.

The highest increase was recorded in Unilever Pakistan Foods Limited, which rose by Rs249 to Rs21,799 per share, followed by Mari Petroleum Company Limited, which increased by Rs52.11 to Rs2,106.79 per share. A significant decline was noted in Rafhan Maize Products Company Limited, which fell by Rs100 to Rs9,800 per share, followed by Hoechst Pakistan Limited, which closed lower by Rs93 to Rs1,156 per share.

Arif Habib Ltd, a brokerage house, said a highly volatile session saw the benchmark continue to sell off before recovering in the second half of the day. Intra-day low saw the market -2.79 percent day on the day before buying came in just above the 61,000 level.

K-Electric Ltd. remained the volume leader with 280.811 million shares which closed higher by 47 paisas to Rs5.77 per share. WorldCall Telecom followed it with 211.123 million shares, which closed lower by 15 paisas to Rs1.55 per share.

Other significant turnover stocks included Cnergyico PK, B.O. Punjab, Hascol Petrol, Fauji Foods Ltd, Kohinoor Spining, P.T.C.L., Pak Elektron and Pak Petroleum. A total of 315 companies recorded future shares, of which 84 increased, 227 decreased and 4 remained unchanged.