Stocks end flat on poor economic data, profit-taking

Stocks slipped on Wednesday owing to fresh wave of profit-taking that surfaced in industry shares after the release of data on large-scale manufacturing (LSM), while blue chips also took a battering, dealers said.

Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index lost 0.21 percent or 85.97 points to close at 40,473.18 points level, while KSE-30 gained 0.11 percent or 18.79 points to end at 17,625.82 points level.

Analyst Ahsan Mehanti from Arif Habib Corporation, said, “Stocks closed lower amid pressure in scrips across the board on investor concerns over political noise, dismal fiscal deficit data, and slump in auto sales for July”.

Weak global equities, concerns over status of Pak-Saudi relations and uncertainty over Supreme Court’s reserved judgment tomorrow over extent of GIDC levies impacting cement, fertilisers, chemical, and textile sectors led to a bearish close, Mehanti added.

Of 405 active scrips, 99 were up, 286 down, and 20 remained unchanged. Volumes stood a 591.172 million shares, compared to 600.041 million in the previous session.

Saad Rafi, head of equity sales at Al-Habib Capital Markets, said, “The market has been under self-correction mode, while overall sentiment has been strong owing to opening of the economy”.

But as the market had recorded surge in the past one month, a little adjustment was witnessed in the cyclical stocks, he added.

Rafi further said, the market might see further dip owing to result season as due to COVID-19 manufacturing sector had not performed well, which could be gauged from the large sector manufacturing sector numbers.

“But one important thing to note is that investment cycle has been changing from mutual funds and insurance companies to individuals which have been termed positive for the market,” Rafi added.

Arif Rehman, head of research at Fortune Securities, said, “The index trading in a narrow range where companies, mostly fertiliser, which are affected by GIDC were in focus due to expected decision by the top court in the coming few days”.

Cement sector is consolidating after a spectacular rally over the past few weeks, he said.

“Energy stocks are also in favour because of expected agreement between IPPs and the government regarding future tariff and receivables from the government,” Rehman added.

Fahad Rauf, deputy head of research at Ismail Iqbal Securites, said, “The equities remained volatile today mainly due to GIDC case as the Supreme Court is expected to announce verdict Thursday”.

He said IPPs remained in the limelight because of noise over resolution of circular debt by the government. “Cements, E&Ps and OMCs dragged the index, shedding 133 points,” Rauf said.

Rafhan Maize, gaining Rs225.00 to close at Rs8,175/share, and Sanofi-Aventis, up Rs58.42 to finish at Rs872.42/share emerged as the top gainers, while Phillip Morris Pakistan, down Rs74.90 to close at Rs1,700/share, and Pakistan Tobacco, losing Rs39.99 to close at Rs1,660.01/share, were the main losers.

Hascol Petrol posted the highest volumes with 88.368 million shares, but lost Rs0.48 to end at Rs15.51/share, whereas K-Electric Limited recorded the lowest with 16.319 million shares and lost Rs0.05 to end at Rs3.83/share.