Stocks close down on lower oil prices; security concerns

Stocks slipped on Tuesday on weaknesses in cement and energy shares, but selected buying in financial scrips curtailed major fall, dealers said. They added that prevailing political uncertainty and security unrest in the city also weigh on investors.

 “Institutional support in selected banking stocks supported the index to close above session lows,” said analyst Ahsan Mehanti at Arif Habib Corp. “Pressure in global crude prices, lower fertiliser prices, and circular debt concerns in the energy sector played a catalyst role in bearish close in the future rollover week at the PSX (Pakistan Stock Exchange).”     

The benchmark KSE 100-share Index fell 0.15 percent or 57.76 points to close at 39,400.19 points. The highest index of the day remained at 39,616.50 points while the lowest level of the day was recorded at 39,361.87 points. KSE-30 Index shed 0.18 percent or 39.61 points to close at 22,532.93 points.

Turnover fell by 13 million shares to 173.74 million shares, trading value rose to Rs8.16 billion against Rs7.18 billion, while market capital dropped to Rs7.91 trillion from Rs7.92 trillion. Of a total of 379 companies’ active in the session, 155 recorded gains, 209 losses while 15 remained neutral.

Ali Raza, analyst at Elixir Securities, said equities witnessed another dull session as gains in financials were countered by losses in cements and oils. “Start to the trading day was on a negative note as index heavy oils opened gap down, tracking downtrend in the global crude,” Raza said. “Whereas, wider market struggled to find a clear direction in early trade as investors stayed on the sidelines, monitoring developments on domestic political front after yesterday’s unfortunate riot incident that prompted security agencies to arrest senior leadership of a political party and close their offices.” 

Market, however, bounced back by mid-day as select financials stocks pushed benchmark index to test 39,600 levels on reported foreigners’ interest. MCB Bank Limited closed up 1.5 percent while Habib Bank Limited closed up 1.2 percent.

Nonetheless, benchmark index couldn't sustain gains as cements alongside with oils were a major drag on reported foreign selling. Engro Corp (down 1.1 percent) also remained out of favor on reported foreign selling and closed negative for the sixth consecutive session.

Raza said he expects volatile trading with participants closely monitoring foreigners’ activity in blue-chip stocks. “Key earning announcements, due tomorrow (Wednesday), of OGDC and HUBC and global crude will gauge market direction,” Raza said.  

Highest increase was recorded in shares of Philip Morris Pak, which rose by Rs141.20 to Rs1,568/share, followed by Murree Brewery that increased by Rs84.19 to Rs905.59/share. Major decline was noted in shares of Rafhan Maize, which fell by Rs125.26 to Rs7,389.40/share, followed by Unilever Foods that decreased by R125 to Rs5,600/share.

Significant turnover was recorded in stocks of K-Electric Ltd, Amtex Limited, Media Times Ltd, Dewan Motors, Dewan Cement, Bank of Punjab, TRG Pak Ltd, Pak Refinery, Pak Elektron, and WorldCall Telecom. 

K-Electric Ltd remained the volume leader with 13.30 million shares with a decline of six paisas to Rs8.64/share. It was followed by Amtex Limited with 11.76 million shares with an increase of 24 paisas to Rs2.13/share.

Shares’ turnover in the future contracts rose to 71.33 million shares from 59.21 million shares.