Stocks gain a little on mixed signals

The index on Thursday ended on a positive note though with limited gains, as uncertainty over rising COVID-19 cases and optimism on Pakistan’s inclusion in the debt relief programme of G20 countries kept tugging at investor sentiments in opposite directions, dealers said.

An analyst from Topline Securities said, “Lacklustre activity was observed at the local bourse, as the index traded between its intraday high of 205 points and intraday low of 226 points.”

This indecisiveness could be attributed to mixed news flow, where decline in Pakistan investment bond yields in SBP auction, and inclusion of Pakistan by G20 in their debt relief programme offered support to the market.

However, pressure in international markets and demand concerns amid coronavirus pandemic weighed down on investors sentiment, the brokerage house said.

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index gained 0.28 percent or 87.27 points to close at 31,329.46 points level. KSE-30 shares index followed suit with a low of 0.11 percent or 15.00 points to end at 13,746.43 points level.

Of 341 active scrips, 162 moved up, 160 retreated, and 19 remained unchanged. The ready market volumes stood at 119.102 million shares, as compared with the turnover of 185.594 million shares in the previous session.

Analyst Ahsan Mehanti from Arif Habib Corporations said, "Stocks closed bullish led by selected scrips across the board, as investors weighed likely approval of $1.4 billion International Monetary Fund (IMF) package for economic support amid virus outbreak and substantial debt relief amid relief plan of G20 countries.”

Investor speculations ahead of major financial quarter-end earnings announcements this week and likely resolution of over Rs2 trillion circular debt crisis played a catalytic role in the positive close, Mehanti added.

An analyst from Habib Metro-Financial Services said, "The timeframe of prevailing economic impasse and intensity of ensuing recession continues to obfuscate the fundamental outlook.”

Moreover, the promise of swift resolution of price war between major oil producing countries appears to be falling short of implementation amid dwindling global demand.

Therefore, investors would be well-advised to proceed prudently, with utilisation of value-buying opportunities in blue chips as their major trading strategy, the analyst added.

Another analyst said the stock market kept seesawing between positive and negative zones throughout the day; however, it ended in the positive zone at the end.

Analyst Danish Laladani from JS Group said, "Going forward, we expect the market to remain sideways, and one might see hustle in the market due to oncoming result season”. But he recommend investors to sell on strength.

The top gainers were Colgate Palmolive, up Rs141.00 close at Rs2,022.00/share, and Phillip Morris Pakistan, up Rs128.95 to finish at Rs2,098.90/share.

Indus Dyeing, down Rs44.46 closed at Rs548.47/share, and Sapphire Fibre, down Rs30.06 closed at Rs635.55/share, were the main losers.

Maple Leaf recorded the highest volumes with a turnover of 14.792 million shares. Its scrip gained Re0.34 to end at Rs23.42/share.

The lowest volumes were witnessed in Pakistan Elektron, recording a turnover of 3.697 million shares, whereas the scrip lost Re0.01 to end at Rs21.24/share.