Thursday January 27, 2022

PSX ends just shy of the green on profit-taking

January 16, 2021

Stocks on Friday ended just shy of the green owing to unabated profit-taking in overbought shares, while tumbling crude oil also took a toll on energy amid power tariff hike noise, dealers said.

Pakistan Stock Exchange's (PSX) benchmark KSE-100 shares index lost 0.13 percent or 58.35 points to close at 45,931.00 points. Volumes decreased to 531.065 million shares, from 620.746 million on Thursday. KSE-30 was no exception as it also shed 0.35 percent or 68.04 points to end at 19,109.64 points.

Brokerage Topline Securities in a note said the market was range-bound, trading between an intraday high of +188 points and intraday low of -114 points to finally close at 45,931 level (down by -0.13%), owing to resistance at 46,000 points level.

Major contribution to the index came from HUBC, NATF, GHGL, INIL, and APL, as they cumulatively contributed 77 points to the index, whereas MCB, HBL, PAKT, LUCK and EFERT cumulatively led to the loss of 81 points, the brokerage added.

Salman Ahmad, head of financial institutions at Aba Ali Habib Securities, said the drop in crude oil price adversely impacted refinery and some of the oil and gas exploration scrips, which saw considerable trimming.

“However, the index showed meager decline, which hints that investor inclination towards market has been positive and the adjustment, which is necessary for the market, will help score sustainable gains going forward,” Ahmad added.

A leading analyst said oil marketers witnessed lukewarm response despite an increase in petroleum products prices for the fortnight ranging from Rs2 to Rs4 per liters.

“The impact of this development will be seen next week as the announcement came just before the closing bell. This increase in petroleum prices will help improve the earnings of the oil marketing companies,” the analyst said.

Of 412 active scrips, 169 moved up, 225 down, and 18 ended as they were at the opening. Analyst Ahsan Mehanti from Arif Habib Corporation said stocks closed lower amid slump in global equities and crude oil prices.

Institutional profit-taking in overbought scrips on concerns over Moody’s forecast for a subdued economic growth at 1.5 percent in FY21 and likely further surge in power tariff ahead of new IMF programme to ease circular debt weighed down the index, Mehanti added.

A leading trader said the downward correction could be attributed to weekend conditions and overbought situation, which overshadowed improving auto and cement sales.

Though, the index gained on weekly performance, trading was concentrated in mostly selective stocks amid concerns over a possible power tariff hike, feared to clip profit margins of industrial sector and add to inflationary pressures, he said.

“Players are waiting for the monetary policy announcement betting on a status quo; however a surprise rate cut could help the index cross 47,000 points,” the trader added.

Sapphire Textile, up Rs49.99 to close at Rs1,049.99/share, and AKD Capital, securing Rs28.64 to finish at Rs410.53/share, stood out as the major gainers.

Rafhan Maize, down Rs281 to close at Rs9501/share, and Pakistan Tobacco, losing Rs62.22 to close at Rs1587.78/share, suffered highest losses in the sessions.

Hum Network posted highest trade volume with 66.328 million shares, gaining Rs0.05 to end at Rs6.95/share. Fauji Foods Limited saw the thinnest trade with 10.957 million shares, while it lost Rs0.16 to close at Rs17.92/share.