Stocks lacklustre as virus bites into sentiment

Stocks on Thursday swung wildly to end largely unchanged with most of the sought-after names trading in a tight band as scares of tougher virus constraints tied investors’ hands amid spiking infection rate, dealers said.

Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index gained 0.05 percent or 20.34 points to close at 42,047.72 points. Volumes decreased to 420.324 million shares 476.871 million shares on Wednesday. KSE-30 lost 0.02 percent or 3.68 points to end at 17,664.64 points. Of 400 active scrips, 171 advanced, 215 retreated, and 14 were unchanged.

Topline Securites in a note said the market opened on positive note continuing its momentum, but couldn’t sustain it owing to profit-taking in latter half of the session.

Higher international oil prices led the exploration and production sector to close higher by 0.34 percent, the brokerage said.

It added that SYS, LUCK, and MCB being the major gainers cumulatively adding 77 points, on the other hand TRG closed 1.75 percent lower, denting investor sentiments.

A A Soomro, managing director at KASB Securities, said the index continued to yo-yo because of a double-digit spike in national infection, which could invite short-term bears back.

“IMF talks, circular debt news, and Eurobond/Sukuk issuances may prove likely positive triggers in light of attractive valuations,” Soomro added.

According to National Command and Operation Center the coronavirus positivity rate has surged to 8.16 percent in Pakistan until December 2, 2020.

Muhammad Saeed Khalid, head of research at Shajar Capital said the market remained mixed during the day, marking an intra-day high of 42,413 and a low of 42,010 points.

He said investors remained uncertain during the day mainly on the Fitch real growth forecast of 0.8 percent along with the drop in crude oil prices.

“Investors remained net sellers in TRG and MLCF where we witnessed an intra-day volumetric activity of 35 million and 31 million respectively,” Khalid added.

Despite, approval of duty-free cotton yarn import by the ECC, the investors could not show notable participation in the textile stocks during the day, he added.

Ansreen Malik, a CFA from BMA Equity Desk, said, “The market still looks attractive and small corrections will be good to accumulate in banks, cements, and steels as all macro-economic factors are supportive and the coronavirus fear has subsided after the vaccine news”.

Analyst Ahsan Mehanti from Arif Habib Corporation said stocks closed in green led by oil, banking and auto scrips on strong valuations.

Mid-session pressure remained on investor concerns for Fitch Ratings grim real growth forecast for FY21 amid ongoing pandemic, he said.

Upbeat data on oil sales, surge in exports for November, and reports of a rise in local auto prices contributed to a positive close, Mehanti added.

Rafhan Maize, up Rs300 to close at Rs8,900/share, and Indus Dyeing, strengthening by Rs37.48 to finish at Rs537.49/share, were the top gainers.

Sapphire Textile, losing Rs67.90 to close at Rs985.10/share, and Colgate Palmolive, shedding Rs50 to close at Rs2,900/share, were the main losers.

TRG Pakistan Limited led volumes with 35,238 million shares. The scrip however, lost Rs1.18 to end at Rs70.07/share. Pakistan Elektron posted the lowest turnover with 7.057 million shares, but gained Rs0.07 to finish at Rs34.06/share.