Stocks to sail through dull sessions next week

Stocks will witnesses a lacklustre trading in the next shortened week for Eid holidays after having enjoyed bullish sentiments for the second- and third-tier shares that lifted the benchmark Index up to the all-time high levels, dealers said. 

A report by KASB Securities said surge in crude oil prices and subdued political noise lifted the mood, leading to healthy volumes especially in cement and auto sectors along with small and mid-cap stocks.

“We reiterate our view of directionless movement, going forward,” the report said. “End of result season and a lack of triggers during the shortened trading week will keep the activity dull.”

There will be two-working days next week because of three-day Eid holidays.

The benchmark 100-share Index of the Pakistan Stock Exchange saw bullish activity throughout the week with exception of the first day and closed the week with an increase of 2.21 percent or 875.58 points to 40,340.23 points.  

The average traded volume increased 22.9 percent to 457 million shares a day because of investor interest in small and mid-cap stocks, while average traded value rose 17.3 percent week on week. 

Foreign institutional portfolio investment recorded an outflow of $7.06 million compared to an outflow of $3.33 million last week.  

HBL, UBL, MCB, OGDC and TRG cumulatively added a massive 493 points, while MUREB, PPL EFERT, HUBC and LUCK dragged the index by 325 points, said a research report of Elixir Securities.

“Despite unabated foreign selling ($7.1 million during the week), net buying by local funds ($10.7 million) and individuals ($4.8 million) offset the selling pressure.

Overall optimism stemmed from the recovery in crude oil prices, improving economic and security situation in the country.  Key outperformers were oil and gas, real estate investment and services, gas utilities, auto and banking and financial institutions, whereas chemicals, cements, pharmaceuticals and foods turned out to be underperformers.

Other key headlines of the week were the Prime Minister’s visit to the PSX to distribute awards to top 25 companies, August oil sales growth, continued strong jump in cement sales, conversion of eight million preference shares of Packages Limited into ordinary shares, resumption of production by Dewan Farooque Motors, and a further cut in urea prices announced by fertiliser manufacturers.

Associated Services Limited, TRG Pakistan, Bank of Punjab, Ghani Glass and Sui Southern Gas were the major gainers, while Murree Brewery, Ibrahim Fibers, EFU Life Assurance, Pakistan Tobacco Company and Saif Power Ltd were the major losers.