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October 28, 2020

Stocks fall on global selloff, security concerns

Business

October 28, 2020

Stocks routed on Tuesday as worsening world markets and security concerns after Peshawar terrorist attack set off a selling spree that even some robust financial results failed to put brakes on, dealers said.

Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index lost 1.12 percent or 468.64 points to close at 41,381.83 points, while volumes were barely changed at 481.047 million shares, as compared to 487.158 million in the previous session. KSE-30 shares index also hit a low of 1.23 percent or 217.06 points to end at 17,377.57 points level.

Analysts at Topline Securities in a report said, “Taking cue from slumping global markets amid security concerns arising from a deadly explosion in Peshawar profit-taking took over the bourse”.

On results front, PSO posted its Q1FY21 financial results with an EPS of Rs11 (below industry estimates), and as a result it lost 3.17 percent, while MCB and FFBL posted outstanding 3QCY20 earnings, which were above industry estimates, the brokerage report said.

Muhammad Saeed Khalid, head of research at Shajar Capital, said, “Despite some robust financial results announced by different banks and corporates, investors remained net sellers during the day”.

Investors made capital gains during the day mainly because of the rollover week ahead of long weekend this week, Khalid said.

“Among the major volumetric scrips, we have noticed UNITY, FFBL, PIBTL and MLCF remained the investors' preference during the day,” Khalid said.

A A Soomro, managing director KASB Securities, said, “Better than expected results failed to turn table and the index closed on a negative note”.

He said the mood was bleak after the tragic terrorist act in Peshawar, where scores of people are killed and injured. “We feel the index would bounce back,” Soomro added.

Trading activity was recorded in 407 active scrips, of which 101 improved, 295 went down, and 11 remained unchanged.

Analyst Ahsan Mehanti from Arif Habib Corporation said, “Stocks closed bearish amid slump in global equities and lower global crude oil prices”.

Investor concerns over security unrest after blast in Peshawar, political noise, and hike in gas tariff for industries dragged the index down, Mehanti added.

Yusuf Saeed, director research at Darosn Securities, said, “The index spiraled down with commercial banks, cement, energy, and fertiliser sector counters taking the hit triggered by somber COVID-wary global markets amid fading hopes for US economic stimulus that led Wall Street to see its worst day in a month”.

The KSE-100 index opened the day on a weak note, but soon uncertainty gripped the market, forcing it to trade sideways till the close, Saeed added.

Unilever Foods, gaining Rs100 to close at Rs13,900/share, and Island Textile, up Rs43.33 to finish at Rs1075.00/share, registered highest gains, while Phillip Morris Pakistan, down Rs78.01 to close at Rs1,599.99/share, and Gatron Industries, losing Rs45.90 to close at Rs650.10/share, were the worst hit scrips of the session.

With 77.190 million shares, Unity Foods Limited, up Rs1.04 to end at Rs22.71/share, recorded the highest trading volume, whereas Hascol Petrol, losing Rs0.42 to end at Rs15.68/share, posted the lowest with 12.844 million.