Stocks end week on a modest note amid virus noise

Stocks on Friday started strong led by crude-oil-fired energy sector, but late profit-taking, mostly owing to pandemic-related economic concerns, cut the rally short, dealers said.

Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index gained 0.38 percent or 159.28 points to close at 42,207 points, while volumes increased to 427.911 million shares from 420.324 million in the previous session.

KSE-30 shares index followed suit with a high of 0.1 percent or 17.86 points to end at 17,682.50 points level.

Arif Rehman, director research at Fortune Securities, said the index traded in a narrow range of 250 points, though underlying sentiment remained positive.

SECP’s initiative to allow capital market accounts to be opened digitally was appreciated by market participants, he said.

“This is expected to bring in new inflows to capital markets over the next few months and finally enable stock market penetration to grow which has been stuck at around 0.2 percent only for last many years,” he said.

“We expect the market to consolidate going into next week after a strong rally during this week, while banking sector is poised to announce record earnings early next year and expected to lead the rally from here,” Rehmand added.

Salman Ahmad, head of institutional sales at Aba Ali Habib Securities, said the continuous rise in crude oil prices helped light up activity in domestic oil and gas exploration stocks, which helped increase overall value of the benchmark index.

Moreover, index made an intra-day high of 42,316 points, with some profit-taking activity before the close owing to sharp rise in COVID-19 cases as rumours of imposition of a lockdown next week panicked investors, Ahmad added.

Additional smart lockdowns have been imposed in several areas of the country as coronavirus cases continue to surge unabated.

Of 409 active scrips, 234 gained, 151 lost, and 24 remained unchanged.

Fahad Rauf, deputy head of research at Ismail Iqbal Securities, said equities remained positive throughout the session, where index heavyweights, exploration and production sector, and commercial banks contributed most (+128 points) on the back of strong sentiments.

“Presently, Arab Light is heading towards pre-COVID level at USD 48.42/bbl up 3 percent DoD,” Rauf said.

Analyst Ahsan Mehanti from Arif Habib Corporation said stocks closed bullish led by oil, cement, and banking scrips on strong earnings outlook, adding that mid-session pressure remained in force on concerns over economic uncertainty and surging circular debt.

“Rupee stability, upbeat data on oil sales, exports for November 2020, renewed hopes for additional incentives for textile sector, extension of construction package led to positive close,” Mehanti added.

Sapphire Fibre, up Rs55 to close at Rs1025/share, and Nestle Pakistan, strengthening by Rs24.80 to finish at Rs6585.05/share, emerged as the highest gainers.

Indus Dyeing, down Rs39.49 to close at Rs498/share, and Sapphire Textile, shedding Rs33.10 to close at Rs952.00/share, were the main losers.

TRG Pakistan Limited was the volume leader with 42,628 million shares and it gained Rs2.5 to end at Rs72.57/share. Hascol Petrol saw the thinnest trade with 13,981 million shares, losing Rs0.06 to end at Rs15.02/share.