Stocks stick to gains as virus loses grip

Stocks on Tuesday built on yesterday’s rally to briefly breach the 46,000 points barrier after 47 sessions mostly because of signs that the virus was likely weakening, dealers said. Pakistan stock exchange (PSX) KSE-100 shares index gained 0.41 percent or 185.51 points to close at 45,981.82 points. Volumes stood at 536.79 million shares compared with the turnover of 437.44 million shares in the last trading session.

Topline Securities in a note said stocks climbed owing to a decline in Covid cases and record high remittances of $2.778 billion for the month of April 2021.

The benchmark index settled just shy of the 46,000 points level, it said.

Moreover, on anticipation of approval by the Federal Cabinet for first installment to IPPs (Independent Power Producers), renewed investor interest was witnessed in the energy chain as PSO, SNGP, OGDC gained 4.62 percent, 4.74 percent, 0.53 percent respectively, the brokerage added.

As many as 404 scrips were active of which 195 advanced, 190 declined and 19 remained unchanged.

Ahsan Mehanti at Arif Habib Corp said stocks closed higher amid pre budget speculations.

He said stocks came under midsession pressure owing to rupee instability and reports of economic contraction by 1.5 percent in FY20.

However, upbeat auto sector sales, record remittances of $2.8 billion in April 2021 and reports on cabinet committee meeting

likely decision on privatisation of state-owned enterprises and higher global crude prices supported the buoyancy, Mehanti added.

KSE-30 Shares Index gained 0.5 percent or 94.18 points to close at 18,826.01 points.

Brokerage Arif Habib Limited in its market review said it was a range-bound session, while early losses were a result of profit-booking in technology stocks, which triggered selling pressure in banks, E&P and OMCs.

A rebound in buying activity brought back interest in Pakistan State Oil, which helped pull the stock price up by a good margin, the brokerage said.

Neelam Naz at JS Global Capital said the market participants booked profits above 46,000 points level in a range-bound session.

The technology sector stood out today contributing 27 percent to the total traded volume of 537 million shares, Naz added.

The country's foreign exchange reserves reached $22.91 billion. Also, amid rising construction activities, steel bar makers on Monday increased the prices by Rs5,000/ton to Rs142,500-143,500/ton. Automobile sales also jumped 54 percent in the first 10 months of FY2021.

However these positive news could not bring much interest among participants in the auto and steel sectors.

Going forward, analysts expect high volatility as the market enters its resistance area between 46,000 and 46,400 points and aggressive profit-taking is highly likely down the line so investors are advised to sell on strength.

Unilever Foods, up Rs1107.9 to close at Rs15,879.9/share and Island Textile, up Rs100.01 to close at Rs2,300/share, ended up as the top two gainers of the day.

Sapphire Textile, down Rs33.49 to close at Rs848.51/share, and Shield Corp, down Rs26.5 to end at Rs328/share, were the worst losers.

Worldcall Telecom was the highest traded stock with 49.5 million shares, trailed by Telecard Limited with 49.09 million shares, and Ghani Global that recorded a trade of 47.23 million shares.