Stocks surrender gains on political uncertainty

Stocks gave up early gains on Tuesday as a late session slide in blue-chip shares wiped out initial optimism triggered by imposition of higher duty on non essential imports, dealers said.

They added that stocks rallied in the early trade backed by rising oil prices and imposition of duty on imported cars, but the rising political noise invited profit-taking.

Ahsan Mehanti at Arif Habib Corp said selling pressure was witnessed in late session on political uncertainty and concerns over dismal economic outlook despite the prime minister’s assurance and World Bank rectification to $17 billion financing need for the current fiscal year of 2017-18.

Early session witnessed interest in selected auto, oil and cement stocks amid foreign inflows and higher in global crude prices, which supported the index. 

The Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index shed 0.16 percent or 66.43 points to close at 40,724.96 points.

KSE-30 shares index shed 0.17 percent or 35.69 points to close at 20,679.42 points. As many as 389 scrips were active of which 147 advanced, 226 declined and 16 remained unchanged.

The ready market volumes stood at 166.837 million shares as compared with the turnover of 124.799 million shares a day earlier. “Market continued the positive trend witnessed over previous session and made an intraday high by 562 points while in the later hours profit-taking and political uncertainty dragged the market into red zone,” an analyst at Arif Habib Limited said.

Market after a choppy start shortly regained momentum with autos providing the early push as government raised regulatory duties on imported cars by 15 percent across all segments. Pak Suzuki Motors (PSMC) and Honda Atlas Cars (HCAR) hit upper circuit. Notable names across oils, cements and consumer plays followed suit and pushed KSE100 Index higher by 1.45 percent.

Pakistan Oilfield (POL), up 3.5 percent, continued its rally on announcement of one-off gains on account of retrospective wellhead gas pricing impact of selected fields. Index met resistance at highs and midday profit-taking completely wiped all initial gains.

Going forward, analysts see volatile trading to continue in near-term with flows and earnings guiding market direction.

Companies reflecting highest gains include Khyber Tobacco up Rs58.96 to close at Rs1,238.19/share and Indus Motor up Rs37.8 to close at Rs1,773.90/share.

Companies reflecting most losses include Nestle Pakistan down Rs127.80 to close at Rs12,500/share and Pakistan Tobacco down Rs77.49 to end at Rs14,72.5/share.

Highest volumes were witnessed in Aisha Steel Mill with a turnover of 15.17 million shares. The scrip gained Rs1.0 to close at Rs18.16/share.

TRG Pakistan was second with a turnover of 11.044 million shares. It shed 69 paisas to close at Rs33.43/share. Dost Steels was third with a turnover of 9.5 million shares. It gained 44 paisas to finish at Rs12.24/share.