Index slips again as investors look at stimulus for respite

The capital market finished slightly lower on Monday, as global equity sell-off and pressure in oil scrips on plummeting prices spooked investors, who have now pinned hopes on prime minister’s stimulus of Rs1.2 trillion, dealers said.

Analyst Ahsan Mehanti from Arif Habib Corporations said, “Stocks closed lower amid pressure in oil scrips and industrials amid falling global crude oil prices, and slump in exports pressuring rupee parity.”

Investor concerns for global equity selloff, foreign outflows, and ongoing rupee instability played a catalytic role in the bearish close at the PSX, Mehanti added.

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index lost 0.31 percent or 86.18 points to close at 28,023.39 points level. KSE-30 shares index followed suit with a low of 0.29 percent or 35.16 points to end at 12,285.08 points level.

Of 328 active scrips, 166 moved up, 145 retreated, and 17 remained unchanged. The ready market volumes stood at 159.469 million shares, as compared with the turnover of 169.438 million shares in the previous session.

Ovais Ahsan, chief executive officer at Optimus Capital Management, said, “The market managed to regain earlier losses, though it still closed in the red on concerns over the increasing rate of local transmissions, which induced panic selling.”

Local oil exploration companies lost ground, as global energy prices hit 17-year lows. “Bargain hunters though helped the bulls fight back from a 2 percent plunge earlier on expectations that the PM would present a comprehensive plan to combat economic effects of the virus later in the day,” he added.

The Economic Coordination Committee of the cabinet approved a package of Rs1.2 trillion to fight the coronavirus pandemic. Sateesh Balani, director research at Ismail Iqbal Securities, said, “Pakistan’s equities witnessed a volatile trading session with benchmark KSE-100 index trading in a wide range of 647 points, while trading activity was also lower with 25 percent dip compared to Friday.”

Cements remained in limelight due to expectations of a relief package for construction to be announced by Prime Minister Imran Khan. International oil price touched new low over weekend which dragged Oil and Gas Development Company and Pakistan Petroleum Limited stock prices down, Sateesh said.

Salman Ahmad, head of institutional sales at Aba Ali Habib, said, “The market was bit stable because of technical factors, as most of the future contracts and rollover settled amicably.”

Another factor which stabilised the equity market was the announcement expected from Prime Minister Imran Khan in relation which construction package, which helped boost sentiment leading to brisk activity in cement and steel sectors, he added.

The top gainers were Rafhan Maize, up Rs100.00 close at Rs6,500.00/share, and Wyeth Pakistan Limited, up Rs40.00 to finish at Rs640.00/share. Bata Pakistan, down Rs77.99 to close at Rs1,397.00/share, and Pakistan Tobacco, down Rs67.98 to close at Rs1632.00/share, were the main losers.

K-Electric Limited recorded the highest volumes with a turnover of 34.974 million shares. Its scrip lost Re0.06 to end at Rs2.65/share. The lowest volumes were witnessed in Fauji Cement, recording a turnover of 4.386 million shares, whereas its scrip gained Re1 to end at Rs13.93/share.