Stocks slip on inflation, geopolitical scares

Stocks on Monday ended lower amid inflation alarms and regional geopolitical concerns, traders said. The Pakistan Stock Exchange's (PSX) benchmark KSE-100 Share Index lost 257.06 points or 0.54 percent to close at 47,429.12 points against 47,686.18 points recorded in the last session. The index tested a day high of 47,742.23 points and a low of 47,357.68 points.

Ahsan Mehanti, analyst at Arif Habib Corp, said stocks fell sharply on concerns over dismal data on CPI (consumer price indicators) inflation at 9.7 percent year-on-year in June, surge in trade deficit to $30.8 billion (up 33 percent for FY21), and security unrest in region.

He said oil, cements, and autos outperformed on upbeat data for OMC (oil marketing companies) sales rising 18 percent year-on-year, 12.7 percent hike in cement sales for June, and tax concessions to the auto sector. Worries over likely MSCI status downgrade to frontier market and surge in circular debt weighed on trade, Mehanti said.

In tandem with the benchmark index, KSE-30 Shares Index also shed 83.58 points or 0.44 percent to close at 19,016.89 points.

Turnover dropped 69 million shares to 494.53 million against 563.81 million shares. Trading value decreased to Rs15.36 billion against Rs16.33 billion. Market capital narrowed to 8.316 trillion from 8.360 trillion. As many as 411 names were active in the session and of that total 133 advanced, 270 lost, while eight saw no change.

Haris Saeed Khan, analyst at Topline Securities said, a lackluster session was observed at the bourse with the benchmark index ending lower.

LUCK, PAKT, ENGRO, PPL, and UNITY cumulatively dragged the index down by around 108 points during the day, Khan said.

He said SNGP remained in the limelight, closing the day at Rs49.74, up 3.69 percent, after announcing FY20 EPS (earning per share) at Rs9.46 accompanied by a cash dividend of Rs4 per share and a higher than expected 1QFY21 EPS of Rs5.01.

The top gainer of the day was Rafhan Maize, which rose Rs453 to finish at Rs10,250 per share, followed by Sanofi-Aventis that grabbed Rs63.99 to close at Rs964.99 per share.

Unilever Foods, being the worst loser of the day, fell Rs200 to end at Rs15,800 per share, trailed by Pakistan Tobacco, down Rs70 to Rs1,380 per share.

Zafar Moti, former director PSX, said the market was going downwards to test 47,000 points level.

Gas prices also impacted the overall market sentiment, Moti said, adding that investors were also cautious owing to Afghanistan situation, fearing any escalation could have repercussions for Pakistan.

“Investor is afraid, as market will come down. Small investors were already cautious because of Eid-al-Azha and were exiting,” he said.

WorldCall Telecom was the volume leader with 55.63 million shares. The scrip dropped eight paisas to close at Rs3.98 per share. It was followed by Hascol Petrol with 39.83 million shares. The share lost 98 paisas to end Rs7.28 per share. Shares’ turnover in the future contracts decreased to 62.47 million from 95.72 million in the previous session.