Daily Times

Stocks staged a comeback on Tuesday, lifting Kse-100 index by 266.33 points to clock at 41,377.26 market level.

The index maintained the momentum throughout the session but witnessed sudden surge in volumes during the late hours of the session on the back of a reduction in August inflation figures as well as the recent recovery in Pakistani Rupee against the US Dollar due to higher remittances.

Pakistan’s Yearly Inflation Rate in August 2020 was 8.21% compared to 9.30 % in July 2020 and 10.50 % in August 2019. While, the July-August average inflation is 8.75% compared to 9.45% from the corresponding period last year. Meanwhile, Pakistani Rupee registered gains on Tuesday and traded at Rs165.4 against the dollar, first time since 18th June 2020. The recent appreciation in the value of rupee follows State Bank of Pakistan’s (SBP) move to sell dollars in the market after getting approval from China to use the $1 billion loan given to maintain forex reserves for budgetary support. Moreover, the value of dollar is also cemented by a record surge in the remittance in the last two months.

The bull-run at the index had submerged following flash floods in Karachi with investors speculating over a possible economic cost of the calamity, however, on Tuesday despite a choppy start, the index managed to touch its intraday high at 41,401.89 after gaining 290.96 points. The index volumes appreciated from 212.36 million shares in the previous session to 371.74 million shares, while the overall market volumes also soared from 451.7 million shares in the previous session to 759.36 million shares.

The volume chart was led by Unity Foods Limited Right Shares, followed by Pak Elektron Limited and Unity Foods Limited. The scrips exchanged 91.24 million, 47.45 million and 45.77 million shares, respectively.

Sectors which lifted the index included Cement with 51.14 points, power generation & distribution with 46.13 points and technology & communication with 44.78 points. Among the scrips, most points added to the index was by TRG Pakistan Limited which added 38.90 points, followed by Colgate – Palmolive Limited which added 26.21 points Mari Petroleum Company Limited added 17.57 points.

Sectors which added pressure to the index were Tobacco with 23 points, Oil & Gas Exploration Companies with 21 points, Commercial Banks with 20 points, Automobile Assembler with 8 points and Real Estate Investment Trust with 1 points. Among the scrips, most points taken off the index was by Oil & Gas Development Company Limited which stripped the index of 29 points followed by Habib Bank Limited with 29 points, Pakistan Tobacco Company Limited with 22 points, Pakistan Petroleum Limited with 14 points and United Bank Limited with 8 points.

Global markets: Global stocks traded mixed over resurgence of Covid-19 in the Europe, raising fears of another round of Covid-19. Moreover, Investors also followed series of economic data in the region which indicated health of regional economies and economic activity.

In Asia, stocks traded mixed, but investors primarily responded to a private survey by Caixin/Markit manufacturing Purchasing Managers’ Index (PMI) for August which showed Chinese manufacturing activity expanding at its fastest pace in nearly 10 years. China’s PMI for august came in at 53.1, which followed Monday’s official data , which revealed China’s official manufacturing PMI for August came in at 51.0, according to the country’s National Bureau of Statistics. PMI readings above 50 signify expansion, while those below that figure indicate contraction.

The stocks in the South Korea led the regional gains, with the benchmark index Kospi adding 1.01% to close at 2,349.55, while in China stocks recovered from an earlier slip to rise on the day, with the Shanghai composite up by 0.44% to about 3,410.61. Hong Kong’s Hang Seng index also made some recovery but fell flat, as of its final hour of trading. However, Nikkei 225 in Japan closed in the negative territory near the flat line at 23,138.07.

In Europe stocks trembled following the Unemployment data revealed on Tuesday, which showed unemployment rate has risen again in the euro zone as the impact of the covid-19 pandemic continues to be felt. Official figures placed the jobless rate in the region at 7.9% for the month of July. The euro area has been grappling with a severe economic recession in the wake of the ongoing pandemic, where the 19-member economy contracted by 12.1% in the second quarter of the year following strict lockdown measures to prevent further contamination. According to Eurostat, region’s economic contraction was the worst since records began in 1995.

On Tuesday, pan-European Stoxx 600 index was 0.95% lower by mid-afternoon, with all sectors except technology trading in the red zone, however the Tech stocks bucked up the trend and advanced 0.6%. Among the major bourses, UK’s FTSE-100 led the losses, closing 1.82%, while CAC-40 in France also lost o0.08%. However, bucking up the trend, Germany’s DAX showed some resistance against the negative economic indicators, and edged up by 0.14%.

In U.S, Wall Street stocks extended gains on Tuesday, as the market tried to build on its best August performance since the 1980s.The Dow Jones Industrial Average gained 63 points, or 0.2%, and pared losses from the previous session. The S&P 500 also advanced 0.3%, while the tech heavy Nasdaq Composite gained nearly 1%. The major gains were led by a surge in Apple stock, which climbed 2.5%, following a stock split that appears to be causing investors to snap up the shares. The investor sentiments at Wall Street were also buoyed by better-than-expected manufacturing data. The Institute for Supply Management (ISM) said in its final read that in the August manufacturing PMI for U.S came in at 56, a 19-month high, as new orders hit their highest level since 2004.