KARACHI: Stocks bounced back to help the benchmark-100 share index gain over 450 points in response to the joint press conference by the Securities and Exchange Commission of Pakistan (SECP) and the Pakistan Stock Exchange (PSX).
The announcement, aimed at pacifying concerns over the recent crackdown on brokerage houses, appeased investors, prompting them to turn bullish again. However, volume remained on the lower side as institutions chose to exercise caution.
At close on Wednesday, the Pakistan Stock Exchange's (PSX) benchmark KSE 100-share Index finished with a rise of 457.93 points or 0.94% to end at 48,992.16.
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Elixir Securities, in its report, stated Pakistan equities finished strong with benchmark KSE-100 Index picking up nearly 1% to settle near the 49,000 level.
“The day started on a positive note as wider market carried momentum from late Tuesday evening and maintained the upwards trajectory as the day progressed,” said analyst Ali Raza.
“Although Tuesday's reassurances by the top brass of capital markets on recent regulatory changes certainly helped in lifting the mood, overall activity remained relatively muted as institutional investors traded selectively in index names in absence of major earnings or triggers,” he commented.
“On the other hand, retail participation improved with most volumes going through industrial and consumer discretionary plays that led gains while small cap speculative plays dominated the volumes chart.
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“Notably, Pakistan State Oil (PSO PA +2.7%) contributed most points on the leader board likely on uptick in local petroleum prices, while Packages Limited (PKGS PA +4%) closed up as the company not only announced better results but also signing of strategic partnership agreement with a foreign company,” said Raza.
“We see ongoing momentum to continue with KSE-100 Index likely retesting 50,000 level in the coming days, however, flows from institutional investors both foreign and local will remain the key in guiding market direction beyond the most recent highs,” he added.
JS Global analyst Nabeel Haroon said bullish sentiments dominated the day as investors came in to accumulate new positions after the joint press conference by PSX and SECP chairmen on Tuesday; in which they stated in-house financing is not concerning and they are taking regulatory measures to ensure small investors' protection.
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“Scrips that took major beating in the recent bear run were the major gainers of today's trading activity,” said Haroon.
“HASCOL (+0.86%) gained to close in the green as the company clarified that there is no truth in the ongoing market rumour that claimed the company lost an arbitration case in the UK,” he said.
“Investor interest was seen in automobile sector as it gained to close (+3.1%) higher. HCAR (+4.57%) and MTL (+5%) were among the major gainers of the automobile sector.
“ISL (+4.55%), INIL (+4.42%) and STCL (+3.04%) extended their previous day gain on the back of the news that LHC has not granted stay order on antidumping duty to importers.
“Investor interest was seen in both the gas utilities SNGP and SSGC, as they gained to close on their respective upper circuit,” the analyst remarked.
“Moving forward, we expect the market to extend its gain and recommend investors to accumulate further positions at current market levels,” he added.
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Trading volumes rose to 234 million shares compared with Tuesday’s tally of 228 million.
Shares of 406 companies were traded. At the end of the day, 307 stocks closed higher, 89 declined while 10 remained unchanged. The value of shares traded during the day was Rs14.3 billion.
Aisha Steel Mill was the volume leader with 15.2 million shares, gaining Rs1.14 to close at Rs24.60. It was followed TRG Pakistan Limited with 14.1 million shares, gaining Rs2.66 to close at Rs58.64 and K-Electric Limited with 9.3 million shares, gaining 0.08 to close at Rs9.61.
Foreign institutional investors were net sellers of Rs416 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.