Stocks post modest gains despite selling pressure
KARACHI: After two days of decline, the stock market managed to find a footing so that the KSE-100 index crawled up by 78.03 points (0.25 per cent) and close at 31,829.24.
Trading started on slightly positive note, but soon yielded to selling pressure on most sectors. The major sellers on Tuesday were foreign investors who offloaded equity worth $3.39 million, which sent the index reeling down to intra-day low by 315 points.
The foreign sell-off would have taken a heavy toll on the market but banks and mutual funds came forward to mop up the liquidity by purchase of shares of $1.59m and $1.70m, respectively.
Market watchers said the index was supported by gains in the heavyweight oil scrips as the rumors were making rounds of government’s arrangement to partially clear the circular debts.
Positivity also prevailed on lower bond yields, improving current account deficit, increase in foreign exchange reserves and stronger rupee. Yet, there were some concerns on successful rollover of future contracts. On the news front, US President Trump reiterated his offer to mediate between Pakistan and India on the Kashmir dispute.
Volumes inched up from 86.6m shares to 88.7m shares (up 2pc day-on-day). Traded value also increased from $24.8m to $24.9m (0.3pc DoD).
Maple Leaf Cement Factory (MLCF), K-Electric and Fauji Cement Company Ltd (FCCL) were the volume leaders with cumulative volume of 25m shares.
Sentiments remained mixed in the cement sector where Lucky and FCCL closed green while MLCF, D.G. Khan Cement and Pioneer closed in the red region.
Intermarket Securities stated that the mixed performance on Tuesday was attributable to gains in energy sectors mainly Pakistan Petroleum Ltd, Pakistan State Oil and Oil and Gas Development Company, consumer staples 1.39pc mainly Colgate-Palmolive and Nestle Pakistan and select financials including Bank Al Habib Ltd and Bank Al Falah Ltd.
On the flipside, financials were down as a whole (0.35pc) mainly Habib Bank Ltd, MCB Bank Ltd, Meezan Bank Ltd and United Bank Ltd along with Hub Power Company kept a tight lid on market’s performance.
Published in Dawn, September 25th, 2019