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Stocks rally on virus letup led bargain-hunting

Business

May 5, 2021

Stocks rallied on Tuesday as a downtick in virus infection ratio triggered bargain-hunting, especially in blue chips, dealers said.

Pakistan Stock Exchange’s (PSX) KSE-100 Shares Index gained 1.11 percent or 487.39 points to close at 44,563.59 points. Volumes shrank to 221.5 million shares from 238.44 million in the last trading session.

Neelam Naz at JS Global Capital said the news of a slight downward trend in Covid cases and positivity ratio on Monday after a continuous rise in recent weeks was taken as a breather by the market.

“Going forward, a cautious stance is advised in the market

and sell on strength is recommended in the coming sessions amid Covid-related uncertainty,” Naz said.

Following the benchmark’s suit, KSE-30 Shares Index too gained 1.29 percent or 233.07 points to close at 18,260.34 points.

As many as 371 scrips were active of which 242 advanced, 110 declined, and 19 ended unchanged.

Brokerage Arif Habib Limited in a report said the market performed well adding a total of 544 points on the board and closed on a high note.

Resolution of rollover uncertainty in TRG Pakistan helped investors take a positive view on the stock resulting in TRG Pakistan hitting upper circuit, it said.

The report added that Netsol on the other hand, remained under pressure with the stock stuck at its lower circuit.

Oil prices also bounced overnight that helped exploration companies inch up, while cement and steel sectors rebounded as well after sustaining losses in the previous sessions.

A A H Soomro at KASB Securities said stock market showed excitement after a long time as Covid infection rate and daily number of cases receded downwards.

“Advocating bullish trend from now - if the third waves' intensity doesn't get worse - investors should position themselves for a leg up. Although, long holidays would keep some investors at bay, valuations are ready for a jump,” Soomro added.

High beta momentum stocks such as TRG Pakistan, Unity Foods, Ghani Global Holdings, and Attock Refinery saw positive upswings.

Pressure was most seen in Netsol as the share prices have crashed from Rs300 to Rs134.

An analyst at Pearl Securities said the benchmark index rebounded on the second day of the week owing to a decline in Covid positivity ratio below 9.0 percent.

“Moreover, procurements have been taken to combat the spread of pandemic as deals have already been signed for the purchase of over 30 million doses,” the analyst said.

Analysts expect accumulation to continue over next two day before the long holidays. Investors eagerly await infection trend and clarity over budget measures.

Rafhan Maize, up Rs69.97 to close at Rs9,525/share, and Wyeth Pakistan, up Rs34.65 to close at Rs1,055.9/share, were the top two gainers of the session.

Nestle Pakistan, down Rs115 to close at Rs5,610/share, and Pakistan Tobacco, down Rs89.99 to end at Rs1,300/share, were the worst losers of the day.

Highest volumes were witnessed in Unity Foods with a turnover of 33.87 million shares. The scrip gained Rs2.4 to close at Rs34.46/share.

Telecard Limited was second with a turnover of 26.28 million shares. It gained Rs1.0 to close at Rs14.75/share. Ghani Global was third with a turnover of 23.57 million shares. It shed Rs2.16 to finish at Rs38.14.