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April 8, 2021

Stocks wobble on surge in coronavirus cases

Business

April 8, 2021

Stocks fell on Wednesday taking a cue from international equities, while investors also grappled with a surge in coronavirus cases in the third wave, dealers said.

Ahsan Mehanti at Arif Habib Corp said stocks closed bearish due to pressure in overbought scrips, as investors grew jittery on economic uncertainty and higher inflation.

“IMF and World Bank projections on lower growth at 1.5 percent and 1.3 percent, respectively in FY21 amid surging public debt and risks to economic outlook due to ongoing pandemic played a catalytic role in the bearish close.”

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index shed 1.02 percent or 451.12 points to close at 43,953.58 points. KSE-30 shares index shed 1.28 percent or 233.62 points to close at 18,012.27 points.

As many as 391 scrips were active of which 133 advanced, 239 declined and 19 remained unchanged.

The ready market volumes stood at 370.526 million shares compared with the turnover of 305.96 million shares in the last trading session.

Meanwhile, PM Khan has indicated a new IMF package to fight Covid, while, IMF’s growth forecast of 1.5 percent and 4 percent for FY21 and FY22, respectively, could not turn the bearish market sentiments.

An analyst at Arif Habib Limited said banks, E&Ps, and the fertiliser sector remained under selling pressure, whereas tech and refinery sector stocks saw mixed reaction from investors.

“Different factors were at play that brought negative sentiment including anticipation of mute growth in financial sector results and decline in international crude oil prices. Cement sector performed well earlier; however, change of overall sentiment brought cement stocks down as well.”

Danish Ladhani at JS Global Capital said KSE-100 remained volatile as it made a high and a low of +167 and -647 points.

Top contributors were TRG Pakistan up 0.8 percent, Ghani Glass (GGL) surged 7.5 percent, Telecard shed 2.5 percent, and Byco Petroleum shed 3.4 percent.

Financials and fertilisers were the major laggards where Habib Bank declined 2.8 percent, Engro Corp was down 2.3 percent, Bank Al Habib declined 4.3 percent, Fauji Fertilizer was down 2.1 percent and United Bank declined 2.4 percent.

AAH Soomro at KASB Securities said book building of Servis Global Footwear started on Wednesday with 100 percent already subscribed. “Book building will continue tomorrow as well and strong response is expected, as investors chase export-themed story with a joint venture with the Chinese,” he added.

Moving forward, analysts expect the market to remain volatile and recommend investors to view any dips as buying opportunities in the cement and steel sectors ahead of the result reason.

Companies reflecting highest gains included Unilever Foods, up Rs250 to close at Rs14,000/share, and Sapphire Fiber, up Rs53.99 to close at Rs849/share.

Companies reflecting most losses included Island Textile, down Rs156.43 to close at Rs1,929.4/share, and Sapphire Textile, down Rs61 to end at Rs801/share.

Highest volumes were witnessed in TRG Pakistan with a turnover of 38.32 million shares. The scrip gained Rs1.09 to close at Rs138.13/share.

Dost Steels was second with a turnover of 30.34 million shares. It gained Re1.0 to close at Rs6.17/share. Azgard Nine was third with a turnover of 22.93 million shares. It shed one paisa to finish at Rs33.05.