Daily Times

Pakistan Stock Exchange (PSX) struggled to sustain early momentum on Thursday, despite positive economic data as benchmark kse-100 fell flat after a range bound session. On Thursday, the Kse-100 clocked at 40,540.70 index level after gaining merely 26 points.

On Thursday the market witnessed early north-run and gained 200 points following positive economic data. Investors welcomed latest figures released by the State bank of Pakistan (SBP), which showed Pakistan posted a current account surplus of $382 million in October 2020, taking the FY21 Current Account surplus to $1.16 billion. This is the fourth straight month the country has posted a surplus on the back of strong exports and remittances. The SBP data showed that in the month of October’20, the current account surplus was 6.47 times higher than the surplus recorded in the previous month and 5.2 times higher than that of recorded in October 2019.

However, investors failed to sustain the early momentum as market continued to weigh in the effects of resurgence of Covid-19 and risk of another lockdown, while the market also continued to discount the hopes built upon the announcement made by U.S Company Moderna, of a promising new vaccine that protects against Covid-19 is nearly 95% effective. Moreover, absence of fresh economic triggers and deprecation of Pakistan Rupee extended the dry spell of market volume. The rupee has already snapped almost two-month winning streak, as an uptick in the dollar demand for import payments weighed on the domestic currency. Pakistani currency has sharply depreciated by nearly Rs2, or over 1% in the past two days, to Rs158.85 against the US dollar in the inter-bank market. The currency bottomed out at just over Rs158 earlier this week…as it had appreciated 6% from an all-time low of Rs168.43 (hit on August 26).

During the session, investors also stayed muted amid mounting speculation, ahead of the monetary policy announcement by the state bank of Pakistan (SBP) due next week, and International Monetary Fund (IMF) review which drove investors to switch portfolio positions. The selling pressure was primarily witnessed in Exploration and Production sector while the buying activity in Banking and cement stocks lifted helped the index close in green.

At kse-100, the index volumes increases from 78.6 million shares recorded in the previous session to 110.82 million shares, while the overall market volumes were recorded at around 188.6 million shares, increasing from the previous session’s volumes of 145.9 million shares.

The volume chart was led by TRG Pakistan Limited followed by Unity Foods Limited and Faysal Bank Limited. The scrips exchanged 27.14 million, 17.81 million and 9.12 million shares, respectively.

Sectors that dented the index were Oil & Gas Exploration Companies with 16 points, Investment Banks with 15 points, Fertilizer with 6 points, Tobacco with 6 points and Automobile Parts & Accessories with 4 points. Among the scrips, most points taken off the index was by Bank Al Habib Limited which stripped the index of 22 points followed by Dawood Hercules Corporation Limited with 15 points, Pakistan Petroleum Limited with 13 points, Oil & Gas Development Company Limited with 12 points and Fauji Fertilizer Company Limited with 7 points.

However, the sectors which continued to resist the pressure on the index were Cement with 17 points, Technology & Communication with 16 points, Commercial Banks with 15 points, Chemical with 10 points and Textile Composite with 9 points. Among the scrips, most points added to the index was by Habib Bank Limited which contributed 27 points followed by TRG Pakistan Limited with 21 points, Lucky Cement Limited with 17 points, United Bank Limited with 11 points and Interloop Limited with 8 points.

Global markets retreat- Lockdown fears outweigh hopes

Global stocks retreated on Thursday as investors’ fears mount over the possibility of global lockdown which threatens to halt newly revived economic activity. Amid resurgence of Covid-19 authorities are around the world are moving to reinstitute some of the stay-at-home orders, curfews and public safety measures, including shutting down nonessential businesses in a handful of cities. There are growing worries that if the infection spread is not contained, widespread lockdowns could be reinstated.

In Asia, Investors remained cautious despite vaccine hopes, as coronavirus cases continued to surge. Among the regional markets, Hong Kong’s Hang Seng index and Japan’s Nikkei 225 traded in the negative territory, with the former closing 0.71% lower, while the latter declined 0.36%. However, the Chinese stock South Korean stocks displayed some resistance, and lifted thee indexes. The Shanghai composite was up 0.47% to 3,363.09, while the Kospi index pared early losses to rise fractionally to 2,547.42.

European stocks however retreated across the board, as investors’ digest the latest calls for lockdown. The pan-European Stoxx 600 declined 0.7% by early afternoon, with oil and gas stocks dropping 1.6% to lead losses as all sectors slid into negative territory. Among the regional bourses, UK’s FTSE-100 led the losses, which declined nearly 1%, while CAC-40 in France and Germany’s DAX declined 0.41% and 0.64% respectively.

In U.S, Wall Street responded to dismal U.S unemployment data ic data as investors fear another melt down of economic activity following Covid-19 resurgence. The U.S Labor Department revealed that 742,000 Americans filed for unemployment benefits in the week of Nov. 14, which topped a Dow Jones estimate of 710,000.

During the early trading hours, 30-stock Dow Jones Industrial Average and S&P 500 fell slightly as the market’s rally this month loses steam.