Market watch: Index inches up, but shies away from 50,000

Benchmark KSE 100-share Index gains 229.35 points

KARACHI: Pakistan equities seemed to be finding momentum again as the benchmark KSE-100 Index closed higher on back of gains in financials and select index names, but shied away from the 50,000-point barrier.

At close, the Pakistan Stock Exchange’s (PSX) benchmark KSE 100-share Index finished with a rise of 0.46% or 229.35 points to end at 49,859.39.

According to Elixir Securities, activity in the wider market was also relatively higher as volumes and turnover on KSE-100 Index both increased by over 22% from Monday.



“Excitement on year-end earnings and pay-out kept most financials in limelight as United Bank (UBL PA +4%) led the day's gains while index heavy Habib Bank (HBL PA +0.5%) too ended up among top ten gainers, however, MCB Bank (MCB PA -0%) ironically closed flat as investors booked profits ahead of its earnings announcements due on Wednesday,” said analyst Ali Raza.

“Gas utilities came under investors’ radar as investors cheered morning news of government intending to build second gas pipeline for LNG import. Resultantly, Sui Southern Gas Company (SSGC PA +5%) and Sui Northern Gas Company (SNGP PA +5%) both closed at their respective upper price limits,” said Raza.



“Participants interest was also evident in Engro Corp (ENGRO PA +2%) and Dawood Hercules (DAWH +2.1%) on pay-out excitement post recent one-off special dividend announcement by Engro Foods (EFOODS PA +0.4%),” he remarked.

“We see market to be largely driven by institutional flows and earnings releases in the near-term, while we continue to see 50,000 as an important resistance level for KSE-100 Index,” he added.

Meanwhile, JS Global analyst Nabeel Haroon said positivity prevailed in the market as the index gained around 229 points to close at 49,859 level.

“Banking sector led the gain in the market as the sector gained to close (+1%) higher than its previous day close. UBL (+3.95%) was the major index mover from the aforementioned sector,” said Haroon.



“Mixed sentiments were viewed in cement sector as flat growth of 0.34% YoY was witnessed in the despatch numbers released by APCMA for the month of January 2017. DGKC (+0.27%) and FCCL (+0.42) were among the major gainers, whereas on the flip slide CHCC (-1.49%) and KOHC (-0.79%) were among the major losers of the aforementioned sector,” the analyst commented.

“Both the gas utilities, SNGP (+4.77%) and SSGC (+5%), gained to close on their respective upper circuit on the back of the news that government has tasked them to lay down a pipeline for the second RLNG terminal from Karachi to Lahore,” he added.

“Profit taking was witnessed in ISL (-2.08%), as the steel company lost value to close in the red zone after closing on its upper circuit for last four trading sessions.

“Moving forward we recommend investors to accumulate new positions on dip,” Haroon added.



Trading volumes rose to 397 million shares compared with Monday’s tally of 281 million.

Shares of 416 companies were traded. At the end of the day, 252 stocks closed higher, 149 declined while 15 remained unchanged. The value of shares traded during the day was Rs17.2 billion.

Lotte Chemical was the volume leader with 50.3 million shares, gaining Rs0.65 to finish at Rs11.10. It was followed by TRG Pakistan Limited with 26.4 million shares, gaining Rs1.67 to close at Rs62.88 and Power Cement Limited with 19.4 million shares, gaining Rs1.00 to close at Rs16.57.

Foreign institutional investors were net sellers of Rs226 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.