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Late profit-taking limits gains at PSX

Stocks on Monday ended on a modest note after a promising start as once again late profit-selling eroded early gains as investors are playing safe ahead of budget, dealers said.

Pakistan Stock Exchange (PSX) KSE-100 Shares Index gained 0.19 percent or 90.96 points to close at 48,302.66 points. Volumes increased to 936.08 million shares to 867.3 million shares in the last trading session.

Topline Securities in a note said equities opened the week on a positive note, printing an intra-day high of 48,632 (up 0.87 percent), but succumbed to profit-taking in the latter half to lose early gains. It said the market participants cheered the payment received by the IPPs (independent power producers) after which Hub Power Co & Kot Addu Power Company both closed the day 0.50 percent higher, while LPL and PKGP gained 4.4 percent and 7.5 percent respectively.

Major positive contribution came in from SYS, GHGL, KTML, PTC and INDU that cumulatively added ~92pts to the benchmark index, while TRG, PSO, PPL, NML, and HBL dragged the index lower by ~67pts, Topline said in its report.

As many as 428 scrips were active of which 225 advanced, 181 declined, and 22 remained unchanged. An analyst at Pearl Securities said the government disbursed Rs89.2 billion to 20 IPPs in the last week which kept the power sector in the limelight.

Moreover, cement dispatches witnessed an uptick of 21 percent in 11MFY21 which also boosted the investors’ sentiment, the analyst added. KSE-30 Shares Index gained 0.02 percent or 3.46 points to close at 19,658.11 points. Ahsan Mehanti at Arif Habib Corp said stocks closed higher after reports of likely NEC approval of Rs2.1 trillion development outlay, Rs 89 billion payment to IPPs and higher global crude oil prices.

He said midsession pressure remained on concerns for weak rupee and pre-budget uncertainty. However, speculations on likely resolution of circular debt crises and government’s resolve for higher growth of 4.8 percent in FY22 helped the bourse stay buoyed.

An analyst at Arif Habib Limited said market saw heavy selling pressure against all the positive news flow over the weekend, from possible reduction in CGT (capital gains tax) to duty reduction for auto makers and release of circular debt related payments to IPPs (independent power producers).

Reportedly, International Steel Limited increased steel prices on Monday which helped the stock price gain during the session; however, profit-booking brought the price below last closing by the end, the brokerage said.

Exploration and production, refinery, oil and gas marketing companies, technology stocks bore selling pressure, it added. Kot Addu Power Company, which was the main beneficiary of release of circular debt related funds from the government, could not stand firmly and selling pressure brought its price below last day closing briefly.

“Moving forward, we anticipate the market to remain upbeat given the lockdown restrictions are easing off gradually, therefore, we recommend our investors to adopt buy on dip strategy in the coming days,” the brokerage said. The top two gainers were Unilever Foods, up Rs899 to close at Rs17,199/share, and Rafhan Maize, up Rs275 to close at Rs9,725/share.

The bottom two losers were Wyeth Pakistan, down Rs197.38 to close at Rs2,434.39/share, and Mehmood Textiles, down Rs12.04 to end at Rs450/share. Hum Network led volumes with 118.20 million shares, followed by Worldcall Telecom posting 80.74 million, and Pakistan Telecommunication with 64.76 million shares.