Market watch: Index gains as oil rebounds

Benchmark KSE-100 index rises 268.06 points

KARACHI: Pakistan equities defied the performance of regional markets to inch higher on Wednesday, rallying close to the 32,900-point mark as gains in the price of crude oil helped sentiment.

The index-heavy oil sector led the way with value-hunters taking advantage of gaining positions in cement, financial and oil stocks.



At close on Wednesday, the Pakistan Stock Exchange’s benchmark KSE-100 index rose 0.82% or 268.06 points to end at 32,891.08.

Elixir Securities’ analyst Ali Raza said Pakistan equities surged led by gains in oils and cements as benchmark KSE-100 index settled near 32,900.

“Despite subdued performance of regional markets, stocks opened higher and index heavy exploration and production sector (E&Ps) took an early lead following near 3% recovery in global crude overnight,” said Raza.

“Participation improved as value hunters, primarily local institutions, stepped in to take advantage of the current weakness and reportedly became buyers in oils, cements and select financials,” he added. “Oil and Gas Development Company (OGDC +2.07%), Habib Bank Limited (HBL +1.17%) and Pakistan Petroleum Limited (PPL +2.24%) contributed most points to the day’s gains, while NIB Bank (NIB -15.97%) topped the volumes chart; churning 45 million shares and experiencing heavy correction which wiped off all of previous day’s gains.

“Meanwhile, Engro Foods Limited (EFOODS -2.85%) also succumbed to profit-taking after it gained around 10% in the last two days,” said Raza.

JS Global analyst Arhum Ghous was of the view that positivity prevailed in the market on the back of recovery in crude oil prices.

“Investor interest was seen in the cement sector as Cherat Cement Company Limited (CHCC 3.56%), Fauji Cement Company Limited (FCCL 2.49%) and Maple Leaf Cement (MLCF 1.18%) all rallied to close in the green zone,” he said.



“FATIMA closed at its lower circuit as the fertilizer manufacturer posted a disappointing year end result, declaring a year-on-year flat earning per share (EPS) of Rs4.41 and no dividend against market expectations of Rs3 per share,” added Ghous

“SING (5%) gained on the back of material information that two individuals and a corporate entity Poseidon Synergies (Pvt) Limited has shown intention to purchase 51% stake in the company.

“Going forward, we expect the market to sustain its positive momentum where any negative variation in international oil prices will serve as a major risk to our view,” he added.

Trade volumes fell to 182 million shares compared with Tuesday’s tally of 204 million.

Shares of 332 companies were traded. At the end of the day, 161 stocks closed higher, 145 declined while 26 remained unchanged. The value of shares traded during the day was Rs8.2 billion.

NIB Bank was the volume leader with 45.4 million shares, losing Rs0.38 to finish at Rs2.00. It was followed by K-Electric Limited with 18.1 million shares, gaining Rs0.02 to close at Rs7.06 and Fauji Cement with 9.8 million shares, gaining Rs1.00 to close at Rs41.19.

Foreign institutional investors were net sellers of Rs81.8 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, March 17^th, 2016.

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