Stocks flatline in tight trade; FATF meeting in focus

Stocks on Monday ended unchanged, drifting in a narrow band, largely owing to an extended trigger-drought, while investors also trod with caution ahead of the global terror financing and money laundering watchdog’s Tuesday meeting, dealers said. Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index gained 0 percent or 0.64 points to close at 42,531.31 points level.

The ready market volumes stood at 509.522 million shares, as compared to 526.186 million in the previous session. Arsalan Soomro, head of equity sales at KASB Securities, said, “The KSE-100 hardly moved during the session again as global coronavirus cases spiked up lately”. With $88 million traded, the interest is intact, Soomro said, adding that nonetheless, the PSX had much more to offer and “we would club this into the ‘correction’ zone”.

“This week is generally crucial for the sentiment as Afghan-US talks are beginning, Asia Pacific Group’s meetings are around the corner, and FATF bills are expected to be passed, increasing the likelihood of whitelisting of Pakistan.” The PSX was still upbeat at the current valuations, Soomro added. The PSX’s KSE-30 shares index fell 0.20 percent or 36.45 points to end at 18,034.69 points level.

Analyst Ahsan Mehanti from Arif Habib Corporation said, “Stocks closed flat led by selected oil and banking scrips on strong earnings outlook”. Higher global equities, upbeat data on remittances for August, rupee stability, and government deliberations over privatisation of OGDCL, PPL helped the stocks stay in the green zone, Mehanti added. Out of 428 active scrips, 184 ended higher, 231 lower, and 13 remained unchanged. Muhammad Saeed Khalid, head of research at Shajar Capital, said, “The market remained sluggish during the session”.

He said the KSE-100 index underperformed mainly owing to the uncertainty over the negotiations between the government and corporate sectors regarding GIDC (Gas Infrastructure Development Cess) and IPPs (Independent Power Producers) agreements reached earlier this year. “Investors booked capital gains, despite, the announcement of remittances numbers, which marked a notable year-on-year rise of 31 percent during the first two months of the current fiscal year,” Khalid said.

Shahab Farooq, director research at Next Capital, said, “Following a positive opening, the market slipped into the negative territory and remained extremely volatile throughout the day”. Furthermore, the volumes were also significantly lower than the recent trends, Farooq added.

Yousuf Saeed, head of research at Darson Securities, said, “The trend was a bit volatile owing to upcoming APG meeting, scheduled from Tuesday, to discuss Pakistan’s progress made on FATF (Financial Action Task Force) compliance targets”. Moreover, Saeed said the market after opening on a positive note remained stuck in a range, where benchmark index vacillated between 42,720.98 and 42,367.81.

Shares that gained the most in the day were Nestle Pakistan, up Rs136.99 to close at Rs6,787/share, and Hinopak Motor, up Rs46.70 to finish at Rs669.47/share, while the ones that lost the most were Unilever Foods, down Rs100 to close at Rs13,400/share, and Island Textile, down Rs66.08 to close at Rs937.00/share. Hascol Petrol posted the highest volumes with 67.076 million shares, gaining Rs0.91 to end at Rs22.99/share, whereas JS Bank Limited recorded the lowest with 12.405 million, losing Rs0.23 to end at Rs7.01/share.