Stocks end flat as investors turn jittery on economic uncertainty

Stocks ended flat on Wednesday as investors remained sidelined amid economic uncertainty and a surprise increase in the policy rate, traders said.

Pakistan Stock Exchange (PSX) benchmark KSE 100-share index inched lower by 0.06 percent or 24.96 points to close the session at 42,348.63 points against 42,373.59 points recorded in the last session. Intraday high was 42,517.81 points, while the lowest level of the day was recorded at 42,268.84 points.

Analyst Ahsan Mehanti at Arif Habib Corp said, “Stocks closed lower on economic uncertainty after a surge in government bond yields following SBP decision to raise key policy rate last week to 16 percent and pressure amid a slump in global equities.”

Political noise, uncertainty over rupee parity and speculations over the outcome of Pak-IMF talks ahead of the release of the next tranche played a catalytic role in the negative close, he said.

KSE-30 index also decreased slightly by 33.27 points or 0.21 percent to close at 15,632.16 points compared with 15,665.43 points recorded in the last session.

Traded shares decreased by 19 million to 120.196 million shares from 139.207 million shares. Trading value dropped to Rs4.657 billion from Rs5.056 billion. Market capital, however, expanded to Rs6.768 trillion from Rs6.762 trillion. Out of 334 companies active in the session, 153 closed in green, 156 in red and 25 remained unchanged.

Topline Securities said a range-bound session was observed at the exchange as the index traded between its intraday high of 142 points and intraday low of -99 points, to finally close at 42,349 points level (down 0.06 percent).

A major contribution to the index came from Pakistan Oilfields, Pakistan Services, Engro, Lucky Cement and Rafhan Maize, as they cumulatively contributed 109 points to the index. On the flip side, HBL, Hubco, UBL, Fauji Fertilizer and TRG lost value to weigh the index down by 113 points.

The highest increase was recorded in the shares of Rafhan Maize, up Rs610 to close at Rs10,990/share, followed by Sapphire Tex, up Rs59.24 to close at Rs1,100.24/share. A significant decline was noted in the shares of Nestle Pakistan, down Rs90 to end at Rs5,810/share, followed by Premium Tex, down Rs19.71 to end at Rs688.99/share.

Brokerage Arif Habib Ltd said a range-bound session was witnessed at the PSX. The market opened in the green zone, but lack of investors’ participation dragged the index down into the red zone, and it continued to trade there for most of the trading session, it reported.

“Market participation was approximately lower than the previous session as volumes remained dry in the mainboard, however, decent volumes were recorded in the 3rd tier.”

Sectors contributing to the performance included commercial banks (-79.9 points), technology and communication (-17.3 points), power generation and distribution (-18.2 points), chemical (-8.2 points) and automobile assembler (-6.9 points).

WorldCall Telecom remained the volume leader with 8.477 million shares that decreased by one paisa to Re1.36/share. It was followed by Nishat ChunPow with 6.671 million shares that closed higher by Re1.05 to stand at Rs15.15/share.

Other stocks that recorded significant turnover included Dewan Motors, K-Electric, TRG Pak, Ghani ChemicalXB, Pak Int Bulk, Hascol Petrol, Roshan Packages and Unity Foods.

Shares’ turnover in the future contracts decreased to 22.856 million shares from 24.471 million shares.