Stocks end flat as Omicron fears grip market

Stocks were largely flat on Wednesday as buoyant sentiment owed to stronger economic data was countered by a government warning that the Omicron variant was spreading at a fast rate in the country, dealers said.

“It was a range bound day at Pakistan equities where the day started on a negative note on the backdrop of rising Omicron cases (new variant) in the country,” Topline Research said in a post market note.

Pakistan Stock Exchange (PSX)’s KSE-100 index moved in the band of 200 points and has closed 17 points or 0.04 percent up at 45,408 points level. The index touched an intraday high of 45,438 points and a low of 45,241 points.

Analysts said a mounting concerns over Omicron variant in Pakistan also put brakes on the positive momentum of the market, witnessed in the first two trading session of the new year.

Brokerage Arif Habib Limited in its post-trading note said the market played in the range-bound area as investors remained risk-averse due to the rising number of Covid-19’s new variant Omicron cases in Pakistan.

“Profit-taking was witnessed in the first trading hour while market battled between the bulls and bears throughout the day,” it added. “Activity continued to remain side-ways as market witnessed hefty volumes in the third tier stocks.”

Health authorities warned on Monday that a fifth wave of infections has started in the country and made preparations to try to contain the fast-spreading Omicron variant. Major cities have started reporting hundreds of cases of the new variant, which was first detected in the country on December 13 in Karachi.

Lahore has a total of 170 Omicron cases and Islamabad 141 to date. Analyst Ahsan Mehanti at Arif Habib Corp said oil and banking scrip amid surging global crude oil prices and State Bank of Pakistan’s reports on banking assets gave little support to the market.

Sectors contributing to the performance include E&P (+25 points), Power (+24 points), Investment Banks/Securities. (+20 points), Fertilizer (+13 points) and Tobacco (+13 points). Volumes increased by 14.9 percent to 432.1 million shares while traded value decreased by 19.5 percent to $58.2 million. The market capitalization was flat at Rs7.7 trillion.

Stocks that contributed significantly to the volumes include WTL, UNITYR3, TELE, FNEL and TRG. Darson Securities said the market opened on a positive note and remained in the green zone for the first hour of the session.

“However, later the market remained volatile and succumbed to profit-taking activity as the nervousness was prevailing across the board due to lack of positive triggers.” The KSE-All Share trading activity ascended as compared to the last trading session as the ready market volume stood at 432 million shares a s compared to the last trading session of 376 million shares.

WTL contributed most of the volume followed by UNITYR. Supernet Limited, a subsidiary company of Telecard Limited announced that it had won a sizeable telecommunications infrastructure development project from a Pakistani mobile network operator. The announcement pushed share value of Telecard to fall third in the highest traded stock in the session.