Stocks inch down on weak economic cues

Stocks fell slightly on Wednesday, remaining bearish for the second consecutive day, due to major declines in blue chip financial and E&P shares, and selling pressure by local investors on delay in the announcement of the supplementary budget related to stock market measures, dealers said.

Madiha Javed, head of research at Ismail Iqbal Securities, said, “KSE-100 remained under pressure throughout the session on lack of major triggers and selling pressure by local investors.”

In terms of index points, banking sector contributed the most to the index’s decline, followed by E&Ps. Cement manufacturers outperformed the index as WAPDA formally accorded approval to award the contract of Mohmand Dam to Joint Venture of Gezhouba-Descon, she added.

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index lost 0.30 percent or 120.41 points to close at 39,568.10 points level. KSE-30 shares index followed suit with a low of 0.41 percent or 77.71 points to end at 18,944.13 points level.

Of 348 active scrips, 140 moved up, 185 retreated, and 23 remained unchanged. The ready market volumes stood at 81.422 million shares, as compared with the turnover of 163.863 billion shares in the previous session.

An analyst at Aba Ali Habib Securities said weak domestic cues on the economic front and continuous border tension with India kept investors’ sentiments subdued. Lower volumes were witnessed as market expectations remained uncertain.

Oil and gas came under heavy selling because of lower growth witnessed in oil consumption numbers, and also because of the dip in the crude oil price which dropped by one percent to trade at 55.97 dollars per barrel.

OGDC was down by Rs1.76 and Pakistan State Oil dropped by Rs3.33 per share.

Cement sector was on the buying side mostly because of the government’s move to speedily work on the construction of couple of dams to improve the water storage situation in the country. The construction of dam would boost cement consumption and sales in the country, thus helping improve profit margins of the cement companies.

For the second consecutive session, auto shares were in the limelight. Investors are waiting for the approval of mini-budget, where the government would likely give a good ahead for several measures taken in January, including allowing non-filers to buy vehicles.

The non-filers would be able to buy vehicles of up to 800cc, which would help improve the sales of auto companies and generate economic activity in the country.

The highest gainers were Wyeth Pakistan Limited, up Rs55.48 to close at Rs1,165.08/share, and Island Textile, up Rs51.50 to finish at Rs1,688.50/share.

Companies that booked highest losses were Phillip Morris Pakistan, down Rs150.00 to close at Rs2,950.00/share, and Siemens Pakistan down Rs22.00 to close at Rs753.00/share.

Fauji Cement recorded the highest volumes with a turnover of 3.390 million shares. The scrip gained Rs0.41 to close at Rs21.46/share.

The lowest volumes were witnessed in Bank of Punjab recording a turnover of 18.104 billion shares, whereas the bank’s scrip lost Rs0.07 to end at Rs14.00/share.