Stocks flat as virus angst offsets energy rally

Stocks settled for a flat close on Wednesday after a promising energy rally, fired up by a crude oil climb, was neutralised by a blanket selling spree mostly owing to worsening virus situation, dealers said.

Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index was up 0.11 percent or 44.27 points higher to close at 41,197.32 points, while volumes decreased to 244.284 million shares from 355.986 million shares on Tuesday.

KSE-30 shares index gained 0.34 percent or 59.18 points to end at 17,367.33 points level.

Topline Securities in its daily market review said, “The market got off to a good start due to higher international

oil prices, making an intraday high of 177 points; however, investors remained on the sidelines on COVID-19 concerns, leading the market to oscillate in a range of 430 points”.

"Oil exploration and production sector was the major gainer of the trading session, closing 2.86 percent up, meanwhile two major financial stocks, HBL and MCB, contributed 46 points to the benchmark index,” the brokerage report added.

Arif Rehman, director research at Fortune Securities, said, “The market had a lacklustre day with index trading in a relatively narrow range”.

After a positive start, the index came under selling pressure on account of increasing COVID-19 cases and authorities recommendations to possibly consider early close of markets, he said adding that however oil sector provided solid support throughout the day on account of increasing international crude oil price.

“The market is expected to trade sideways as long as coronavirus cases continue to rise in the country,” Rehman added.

Trading activity was recorded in 401 active scrips, of which 133 gained, 247 lost, and 21 ended unchanged.

Muhammad Faizan Munshey, Associate Director at KASB Securities, said, the market closed flat as rally in oil stocks balanced the sell-off in other sectors.

“The rally which started with the news of coronavirus vaccine seems to have faded away somewhat with investors being cautious about the rising cases in the country and challenges regarding the distribution and approval of the vaccine,” Munshey said.

“We expect the market to stay range-bound for the rest of the week in the absence of any major market-moving triggers,” Munshey added.

Analyst Ahsan Mehanti from Arif Habib Corporation said, “Stocks closed higher led by oil, banking and fertiliser scrips on strong valuations”.

Higher global equities, surge in global crude oil prices, 20 percent surge in banking deposits in October and strong rupee recovery kept stocks anchored in the green, Mehanti added.

Island Textile, up Rs92.64 to close at Rs1327.94/share, and Sapphire Textile, up Rs77.58 to finish at Rs1131.00/share led the gains chart, while Rafhan Maize, down Rs170 to close at Rs8,355/share, and Phillip Morris Pakistan, shedding Rs88.64 to close at Rs1,451.36/share, led the losers of the day.

BankIslami Pakistan was the volume leader with 31,519 million shares and it added Rs0.95 to end at Rs10.74/share, whereas Oil & Gas Development Company saw the thinnest trade with 5.111 million, but put on Rs3.75 to end at Rs101.50/share.