Stocks decline as financial institutions opt for profit-taking

148
SOURCEThe News
  • 3
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
    3
    Shares

Stocks declined on Wednesday, as financial institutions and banks opted for profit-taking, counting on the almost 1,500 points gained during the previous two sessions, dealers said.

Analyst Ahsan Mehanti from Arif Habib Corporations said, “Bearish activity was witnessed at PSX on institutional profit taking amid economic uncertainty.”

Oil and financial stocks outperformed on surging global crude oil prices and rising banking spreads. Dismal data on CPI inflation for December 2018, Fitch report fears over slide in growth rate and exports, concerns for pending circular debt, and uncertainty over terms of IMF bailout package played a catalytic role in the bearish close at the PSX, he added.

Advertisement

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index lost 0.33 percent or 130.81 points to close at 38,921.69 points level. KSE-30 shares index followed suit with a low of 0.14 percent or 26.06 points to end at 18,479.35 points level.

Of 336 active scrips, 104 moved up, 212 retreated, and 20 remained unchanged. The ready market volumes stood at 133.847 billion shares, as compared with the turnover of 166.790 billion shares in the previous session.

Also Read: Stocks rally 1,015 points on mutual fund buying

Ahmed Lakhani, research analyst at JS Global, said tractor shares were also down owing to various concerns, especially 12-15 percent increase in price during 2018 and uncertainty in the sector due to rumours of relaxation on used tractor imports. Millat Tractor lost Rs18.93/share, and Al-Ghazi lost Rs1.40/share on sharp decline in sales. An analyst from Ismail Iqbal Securities said textiles too failed to garner investor attention, despite announcement of lower power tariff for zero-rated industrial sectors.

“We expect a choppy session on Thursday with improved activity. However, expectations on mini-budget to be announced soon, will likely determine the direction,” the analyst said.

Cement companies were on the selling side too, and lost in the range of Rs0.04 to Rs1.43 as local cement dispatches declined by 3.79 percent to 3.27 million metric tons in December. However, the industry continued to report a notable growth in export dispatches. The cement capacity utilisation during December remained at 85.5 percent, 860bps lower than the corresponding period last year.

Meanwhile, the financial sector also showed minus signs on the report of Fitch Solutions, which said that given the current inflation rate; there was possibility that the interest rate would remain unchanged. New monetary policy would likely to be announced in the third week of this month. Auto shares came under pressure and suffered a loss of Rs0.30 to Rs3.28 on apprehensions that automobile sales were expected to decline by three percent during December 2018. The highest gainers were Nestle Pakistan, up Rs101.00 to close at Rs8,300.00/share, and Shezan International, up Rs22.93 to finish at Rs489.99/share.

Companies that booked the most losses were Rafhan Maize, down Rs250.00 close at Rs6,500.00/share, and Unilever Foods, down Rs95.00 to close at Rs7,105.00/share.

Pakistan Elektron recorded the highest volumes with a turnover of 25.121 billion shares. The scrip gained Rs0.64 to close at Rs27.55/share. The lowest volumes were witnessed in Unity Foods Limited, recording a turnover of 11.660 billion shares, and losing Rs1.07 to end at Rs25.99/share.

(This news/article originally appeared in The News on January 10th, 2019)

Facebook Comments