KARACHI:
The Pakistan Stock Exchange (PSX) on Monday surged over 850 points to a new all-time high on investor confidence on falling inflation and the government’s talk of privatizing troubled state-owned enterprises (SOEs).
After opening trading, the KSE-100 hit an intraday low of 72,462.49 points in the very first hour. However, the market quickly began its recovery, driven mainly by the increase in foreign exchange reserves and speculation surrounding the upcoming loan talks between Pakistan and the International Monetary Fund (IMF).
Additionally, discussions with a Saudi Arabian trade delegation on potential investment avenues also contributed to the notable uptrend. As a result, the index breached the 73,000 barrier, hitting an intraday high of 73,060.74 in the early afternoon.
Throughout the day, the market showed strong momentum with several sectors performing well, particularly cement and pharmaceuticals, which recorded notable gains. Despite falling below the 73,000 level, the stock market managed to close with significant strength.
“Stocks closed at an all-time high as investors weighed the fall in inflation, which could lead to an easing of State Bank policy and the government’s talks to privatize troubled state-owned enterprises,” said Ahsan Mehanti, MD of Arif Habib Corp.
“Speculation ahead of the Pakistan-IMF loan talks, rising foreign exchange reserves and possible investment deals with a Saudi trade delegation played a catalyst role in a record close in a pre-budget rally on the PSX.”
At the close, the KSE-100 index gained 862.15 points, or 1.2%, to settle at 72,764.24.
Topline Securities, in its report, wrote that the KSE-100 index recorded a bullish period. “Positive sentiment can be attributed to recent news of a 50-member Saudi team arriving for possible investment in Pakistan along with expectations of an IMF mission coming this month to discuss a new program,” it said.
Major positive contributions came from Dawood Hercules Corp, Fauji Fertiliser, Engro Corporation, Interloop Limited and Hub Power, which collectively added 360 points to the index.
In contrast, Oil and Gas Development Company, Mari Petroleum, Systems Limited, Ibrahim Fibers and National Bank of Pakistan contributed negatively, shedding 68 units, Topline added.
Arif Habib Limited (AHL), in its commentary, said there was “another 1% gain day-on-day as the market recovery gained momentum.”
About 71 stocks advanced while 27 declined with Dawood Hercules (+7.5%), Fauji Fertilizer (+2.68%) and Engro Corp (+1.95%) the biggest contributors to the index’s gains, it said , adding that cement and pharmaceutical stocks outperformed. with notable gains in Fauji Cement (+5.06%), DG Khan Cement (+2.94%), GlaxoSmithKline (+7.5%), Abbott Laboratories (+7.5%) and Citi Pharma (+6, 17%).
Total trading volumes increased to 578.4 million shares compared to Friday’s 452.2 million. The value of shares traded during the day was Rs 24.5 billion.
Shares of 389 companies were traded. Of these, 258 stocks closed higher, 108 declined and 23 remained unchanged.
Pak Elektron was the volume leader with 48.4 million shares traded, gaining Rs 1.74 to close at Rs 25.13. It was followed by Fauji Cement with 40.4 million shares, gaining Rs 1.08 to close at Rs 22.44 and K-Electric with 26.8 million shares, gaining Rs 0.05 to close at Rs4.41.
Foreign investors were net buyers of shares worth Rs 434.9 million, according to NCCPL.
Published in The Express Tribune, May 7u2024.
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