Stocks retreat on new virus variant frets

Stocks on Monday remained in retreat amid noise over surge of a new Covid variant and regional unrest ahead of long Eid holidays next week, traders said.

Pakistan Stock Exchange's (PSX) benchmark KSE 100-share Index gave up 116.37 points or 0.24 percent to close at 47,447.08 points, hitting a day high and a low of 47,715.28 points and 47,408.52 points, respectively.

Zafar Moti, former director PSX, said the market had slowed down and volumes were shrinking. “People are downsizing themselves because of the Sacrificial Eid. Afghanistan issue and political noise was also there.”

“Next week is off and the market is unlikely to gather any momentum this week and may remain directionless until Eid holidays are over,” Moti said.

KSE-30 Index also shed 49.13 points or 0.26 percent to close at 19,061.74 points. Traded shares dropped 31 million shares to 474.99 million against 505.99 million shares, while trading value decreased to Rs14.32 billion against Rs15.37 billion. Moreover, market capital eased to Rs8.294 trillion from Rs8.315 trillion.

Out of 412 active shares in the session, 136 gained, 257 weakened, and 19 closed the day unchanged.

Brokerage Arif Habib Limited in a report said the market traded in a narrow range and was slowly adjusting downwards after gaining some 900 points last week.

Technology, steel, refinery and cement sectors were particularly under selling pressure, the brokerage said.

“Institutional investors have particularly been concerned over the developing situation in Afghanistan that can have an implication on otherwise peaceful law and order situation in Pakistan, as well as increasing current account deficit that can result in declining rupee parity with USD,” the brokerage added.

Pakistan Tobacco, up Rs45.44 to Rs1,300/ share, was the best gaining scrip of the day, followed by Mehmood Textile, up Rs40.90 to close at Rs587.90 per share.

Nestle Pakistan was the most battered stock, falling Rs215 to Rs5,875 per share, trailed by Sapphire Textile, down Rs29.01 to Rs909.99 per share.

Haris S Khan, analyst at Topline Securities, said, the index continued with its lackluster activity.

“With positivity rate closing in on 4 percent, the fourth wave of Covid weighed down on sentiments and with the CGT (Capital Gains Tax) collection date (July 16, 2021) drawing nearer, selling continued in the market to generate liquidity,” Khan said.

“Furthermore, investors opted to stay on the sidelines as rising international oil prices coupled with rupee devaluation caused concerns regarding inflationary pressures and a higher import bill.”

The Topline analyst said TRG, LUCK, BAHL, and NESTLE cumulatively dragged the benchmark index lower by around 72 points, while UNITY, PSX, MCB and PAKT closed in green and added around 66 points to the index.

“Moreover, Citi Pharma Limited again closed at its upper circuit at 36.98 on its second day of trading taking its cumulative return to 15.6 percent in two days,” Khan added.

A notable trading activity was witnessed in WorldCall Telecom, Treet Corp, TPL Corp Ltd, Ghani Global Glass, Unity Foods Ltd, Fauji Foods Ltd, Silk Bank Ltd, Loads Limited, TPL Properties, and Byco Petroleum.

WorldCall Telecom led volumes with 70.99 million shares. The stock weakened 21 paisas to close at Rs3.64 per share. It was followed by Treet Corp that posted a trade of 63.61 million shares, losing 52 paisas to settle at Rs60.88 per share. Turnover in the future contracts increased to 77.08 million from 62.84 million shares traded in the previous session.