Stocks slip as investors hedge bets ahead of budget

Stocks ticked down on Tuesday as investors continued to hedge their bets to create a cushion against any budget shocks in case economy takes a turn for worse, dealers said.

Pakistan Stock Exchange’s (PSX) KSE-100 Shares Index shed 0.32 percent or 154.68 points to close at 48,147.98 points. Volumes increased to 1.04 billion shares from 936.08 million in the last trading session.

Topline Securities in a note said the benchmark index witnessed profit-taking for the 2nd consecutive day and the index tested an intra-day low of 48,000, down 0.63 percent.

The brokerage said KAPCO remained in the limelight as its board of directors was scheduled to meet on Wednesday (today) to consider the declaration of an interim cash dividend while the stock closed at Rs46.66, up 6.12 percent.

TRG on the other hand succumbed to selling pressure as investors digested the possible implications of a proposed Global Minimum Tax Rate by the G7 Countries, it added.

Topline further said major laggards were namely TRG Pakistan, PSO, OGDC, SNGP, and KTML that cumulatively led to a loss of 133 points.

Ahsan Mehanti at Arif Habib Corp said profit-taking was witnessed at PSX on pre-budget uncertainty as investor remained concerned over slump in global crude oil prices and weak global equities invited pressure.

He said midsession support was witnessed in energy stocks after settlement of Rs89 billion worth of independent power producers’ dues, and upbeat sales posted by fertiliser, auto, and cement sectors during May 2021.

However, concerns over foreign outflows, deadlock over IMF tax measures and rupee instability dragged the index down, Mehanti added.

KSE-30 Shares Index shed 0.42 percent or 83.19 points to close at 19,574.92 points.

As many as 422 scrips were active of which 139 advanced, 268 declined, and 15 remained unchanged.

An analyst at Arif Habib Limited said market slumped after selling pressure that began a day earlier continued to mount.

He said increase in price helped cement stocks trade in green, whereas Kot Addu Power Company saw price moving up on hopes of an interim dividend.

Maaz Mulla at JS Global Capital said despite starting on a positive note, the market slid into the negative territory.

“The coronavirus positivity ratio has dropped to 3.02 percent in Pakistan according to the National Command and Operation Centre but these repots failed to boost any buying,” Mulla said.

Selling pressure was witnessed in refineries, steel and technology sector. Byco Petroleum lost 2.1 percent, Attock Refinery 2.0 percent, National Refinery 1.4 percent, International Steel 1.8 percent, Agha Steel 1.5 percent, while TRG Pakistan declined 3.9 percent.

Going forward, analysts recommend investors to avail any downside as a buying opportunity in construction and export sectors.

Nestle Pakistan, up Rs69.52 to close at Rs5,776.19/share, and Rafhan Maize, up Rs65 to close at Rs9,790/share, were top two gainers of the day.

The bottom two losers were Unilever Foods, down Rs699 to close at Rs16,500/share, and Wyeth Pakistan, down Rs182.57 to end at Rs2,251.82/share.

WorldCall Telecom maintained its volumetric supremacy with a turnover of 399.96 million shares, trailed by Byco Petroleum with 37.8 million, and Hum Network that saw its 35.11 million shares changing hands.