Market watch: Energy and banking stocks lead as index posts healthy gain

Benchmark KSE-100 index rises 187.54 points

KARACHI: Pakistan equities broke a rather lean spell of directionless trading, settling over 39,650 points as institutional buying kicked in and provided a much-needed impetus.

At close, the Pakistan Stock Exchange’s benchmark KSE-100 index recorded a rise of 0.48% or 187.54 points to end at 39,663.71.

Elixir Securities, in its report, said stocks opened higher with Exploration and Production (E&Ps) and select financial scrips leading the charge; former tracking the increase in global crude prices while the latter fetching interest after Monday’s heavy net foreign buying in the sector.



“The wider market followed suit and edged up with notable sectors eking out modest gains as investors downplayed fresh concerns related to law and order and cherry picked value plays.

“The top four index movers on Tuesday were Habib Bank Limited (HBL PA +1.7%), Pakistan Oilfields Limited (POL PA +3.3%), Oil & Gas Development Company (OGDC PA +1.4%) and Pakistan Petroleum Limited (PPL PA +1.6%) that cumulatively contributed over 60% positive points to KSE-100 index.

“On the flip side, the Muslim Commercial Bank (MCB PA -1.6%) remained under selling pressure and dented index by a good 30 points after trading most volumes since mid-July,” said the report.

“Overall, healthy activity was witnessed in wider market as volumes on KSE-100 index picked up by 34% versus Monday, while small and mid-cap dominated volumes chart with K-Electric (KEL PA -0.1%) once again leading.

“We expect current momentum to gather pace with institutional flows and corporate earnings season likely driving wider market to re-test recent highs,” remarked Elixir Securities analyst Ali Raza.

JS Global analyst Ahmed Saeed Khan, on the other hand, said positivity prevailed due to the energy and the banking sectors.

“The energy sector rallied around 1.42% on the back of recovering global crude oil prices. WTI traded comfortably around $43/barrel. All major players remained comfortably in the green zone, where top performers of the aforementioned sector today were OGDC (+1.35%) and POL (+3.31%).

“Moreover, the automobile sector rallied 0.69% on the back of depreciating Yen, where biggest index movers of the sector on Tuesday were Honda Atlas Cars (HCAR +1.11%) and Indus Motors (INDU +0.59%).”



“The banking sector continued its rally as HBL and NBP closed +1.65% and +1.59%, respectively.”

“Overall sentiments of the market remain positive and a further bull run from these levels is expected, however, early accumulation is advised,” said Khan.

Trade volumes rose to 221 million shares compared with Monday’s tally of 199 million.

Shares of 386 companies were traded. At the end of the day, 226 stocks closed higher, 142 declined while 18 remained unchanged. The value of shares traded during the day was Rs11.5 billion.

K-Electric Limited was the volume leader with 33 million shares, gaining Rs0.01 to finish at Rs8.68. It was followed by Sui Southern Gas Company (SSGC) with 11.1 million shares, gaining Rs1.53 to close at Rs32.16 and Pakistan Telecommunication Company Limited (PTCL) with 8.2 million shares, gaining Rs0.14 to close at Rs15.45.

Foreign institutional investors were net sellers of Rs132 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, August 10^th, 2016.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.