Market watch: Driven by oil and cement stocks, index settles at new high

PSX benchmark index records an increase of 322.48 points

KARACHI: Pakistan equities resumed their northbound ride on Thursday and settled at a new record high with oil and cement stocks leading the day's gains.

At close, the Pakistan Stock Exchange's (PSX) benchmark KSE 100-share Index recorded an increase of 322.48 points, or 0.63%, to end at 51,426.01.

According to Elixir Securities, the market opened positive with index-heavy oil stocks opening gap up as investors reacted strongly to the overnight surge in global crude after OPEC members cut supply to Asia amid dip in US inventories.

"Oil and Gas Development Company (+2.4%) was the star performer, contributing most points to the index followed closely by Lucky Cement (+1.8%) that hit an all-time high and settled just Rs12 away from the 1,000 mark," said analyst Ali Raza.



"Financial stocks, on the other hand, traded mixed with United Bank (-1.4%) witnessing profit-taking as it chipped away most points from the index while Habib Bank (+0.5%) settled marginally higher."

Most of the activity was noted in small-caps on retail investor interest as stocks such as Summit Bank (+18.9%), WorldCall Telecom (-5.6%), Dewan Cement (+3.6%) and Byco (+5%) recorded significant trading.

The highlight of the day was Sazgar Engineering Works (+5%) that hit its upper price limit after the company announced its intention to venture into passenger and light commercial vehicle business, the analyst said.

"[We] Expect the ongoing bullish momentum to continue while activity in the wider market is also expected to improve as the MSCI upgrade date approaches," he added.

JS Global analyst Arhum Ghous said positivity prevailed in the market for most part of the day as the KSE-100 index gained around 322 points. Optimism was driven on account of investor interest in potential MSCI Emerging Markets stocks.



"Major index movers were Oil and Gas Development Company, Lucky Cement, Mari Petroleum (+3.51%), Pakistan Oilfields (+2.26%) and Habib Bank as they cumulatively contributed +162 points to the index," he said.

On the flipside, UBL, National Refinery (-2.56%) and Bank Al-Habib (-1.01%) were major laggards of the index.

"Major contribution to the index came from E&P (exploration and production) sector as oil prices edged higher, extending their biggest one-day jump since December. Oil and Gas Development Company, Pakistan Oilfields and Pakistan Petroleum (+2.59%) were major gainers of the sector," the analyst said.

Growth was also witnessed in the steel sector with International Industries Limited (+5%), International Steels (+1.85%) and Aisha Steel Mills (+0.91%) closing in the green zone.

"Moreover, confidence was recouped in the cement sector where buying was witnessed in Dewan Cement (+3.58%), Lucky Cement and Cherat Cement (+0.61%)," Ghous said.



"Moving forward, we expect the market to continue its positive momentum and recommend investors to accumulate MSCI EM stocks on dips."

Overall, trading volumes rose to 397 million shares compared with Wednesday's tally of 334 million.

Shares of 386 companies were traded. At the end of the day, 239 stocks closed higher and 133 declined while 14 remained unchanged. The value of shares traded during the day was Rs17.8 billion.

Summit Bank was the volume leader with 31.2 million shares, gaining Rs1 to close at Rs6.30. It was followed by WorldCall Telecom with 24.8 million shares, losing Rs0.17 to close at Rs2.89 and Dewan Cement with 20.5 million shares, gaining Rs0.96 to close at Rs27.81.

Foreign institutional investors were net sellers of Rs418 million during the trading session, according to data maintained by the National Clearing Company of Pakistan Limited.