KARACHI: Stocks retreated for the second day on Thursday, but not before surging to intraday high by 308 points. Investors who mistook it as the return of the bull found themselves fumbling to cut losses in the last hour of trading.
The KSE-100 index tumbled to intraday low by 117 points but managed to crawl up and close the day’s trading with a loss of 33.37 points, or 0.07 per cent, at 48,093. Traders said it was a relief to see that the index could keep its head above the 48,000-level.
The market took off to a firm start and shares across the board gained values on buying mainly by companies, banks and mutual funds. Late profit-taking mainly by foreign investors who sold shares worth $2.50m and broker proprietary trading that dumped stocks valued at $3.17m in the cement, banks, textile and E&P sector at higher levels, saw the index beat a hasty retreat.
Sectors contributing to the bearish performance included cement (45 points), banks (35 points), fertiliser (26 points), technology (42 points) and O&GMCs (19 points). Stocks that contributed positively to the index include TRG (44 points), MEBL (23 points), PSO (12 points), INIL (10 points) and The Searle (8 points). Stocks that contributed negatively include Lucky Cement (48 points), BAHL (17 points), MTL (16 points) and Engro Crop (16 points).
PSO edged higher on expectations of release of payment related to circular debts, whereas steel sector performed on the possibility of reduction of duties in the upcoming budget. The amendment in capital adequacy regulations by significantly lowering the applicable risk weight from 200pc to 100pc on banks/DFIs’ investments in the units of REITs, triggered activity in the investment banking sector.
Automobiles grabbed the spotlight as reports surfaced of government considering reducing taxes on new imported and locally assembled cars of up to 800cc engine capacity in the budget. Pharmaceutical sector saw quite a few firm scrips as Ferozsons, GSKCH, GLAXO and The Searle. Technology stocks saw activity in TRG and Netsol.
The trading volume declined 15pc over the previous day to 890m shares. WTL led the volume list with 135m shares changing hands.
Published in Dawn, June 4th, 2021
