Stocks end flat as mini-budget rally slips on oil

Stocks on Wednesday stayed afloat in a narrow strait with some select sectors recording fresh gains as investors placed new bets on shares that are likely to be the beneficiaries of some of the supplementary budgetary measures announced by the government in a bid to ease fiscal pressure, dealers said.

Ahsan Mehanti, an analyst at Arif Habib Corporation said the bullish trend continued on speculations amid upbeat mini-budget and lowering fiscal deficit target to 5.1 percent for FY19.

“The auto, steel, and cement sectors outperformed on strong earnings outlook after amended finance bill 2018 favored continuation of CPEC (China-Pakistan Economic Corridor) projects, proposed reversal of petroleum development levy, and allowed non-filers to buy cars and property, which is seen as attracting investment in the relevant sectors,” Mehanti added.

Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index rose 0.20 percent or 82.06 points to close at 41,320.13 points, while its KSE-30 shares index fell 0.06 percent or 12.71 points to end at 20,130.31 points.

As many as 351 scrips were astir today, of which 192 moved up, 140 retreated, and 19 remained unchanged. The ready market volumes stood at 158.719 billion shares as compared with the turnover of 166.519 billion shares in the previous session.

Samiullah Tariq, director research at Arif Habib Ltd, said the market moved in a narrow band, amidst pressure from FTSE rebalancing where outflows were expected generally in Mari Petroleum, believed to be an exclusion from the index, but otherwise it saw selling pressure in Habib Bank, United Bank Ltd, and Oil and Gas Development Company (OGDC) shares.

“The volume was down owing to upcoming Moharram holidays. Now the trading will resume on Monday,” Tariq said.

In the wake of the decision to allow non-filers to buy automobiles and property spurred activity in the cement and auto shares. Auto sector recorded a maximum gain of Rs13.85/share in Honda Motors, followed by Gandhara Motors rising by Rs13.35/share. Moreover DG Khan Cement and Fauji Cement led the sector in terms of volumes.

However, OGDC, Pakistan State Oil, and other refineries took a hit with a drop in international crude oil price following reports that oil stocks have seen a sharply rise against the market expectations. Being heavyweights, the losses in the shares of these companies did not let the index to score big. The highest gainers were Indus Island Textile, up Rs70.28 to close at Rs1475.90/share, and Pakistan Tobacco, up Rs39.00 to finish at Rs2399.00/share.

Companies that booked highest losses were Nestle Pakistan, down Rs472.30 to close at Rs8986.00/share, and Millat Tractors, down Rs19.49 to close at Rs1131.52/share. K-Electric Limited recorded the highest volumes with a turnover of 30.606 million shares. The scrip gained Rs0.01 to close at Rs5.38/share.

The lowest volumes were witnessed in Summit Bank, recording a turnover of Rs15.113 million shares, the scrip lost Rs0.01 to end at Rs1.12/share.