Market watch: Stocks bounce back, end week on a positive note

Benchmark index gains 442.37 points to settle at 41,401.02

KARACHI: In contrast to the previous session, the stock market broke its two-day losing streak on Friday and entered the green zone.

Propelled by cement, auto and oil stocks, the benchmark index - which had hit a new low on Thursday - managed to close above 41,000 points.

The KSE-100 index shot up from the word go to hit an intra-day high of 677 points in just the first half hour of trading. Later, it started to descend, but still remained positive.

At close, the benchmark KSE 100-share Index recorded an increase of 442.37 points or 1.08% to end at 41,401.02.

Elixir Securities, in its report, stated Pakistan equities closed last day of the week higher with the benchmark index settling above 41,400, helped by gains in index names.

Habib Bank (HBL, +5%) was the star performer as it turned around from seven days of losses and hit its upper price limit in pre-open trading as in an interesting turn of events the New York regulator imposed a final penalty of $225 million, which was only a little over one-third of the intended fine of $630 million.

"Notable index names across major sectors followed HBL's lead and traded higher on both institutional and retail buying," stated Elixir.



Despite bullish sentiments in the wider market, the overall activity remained flat compared to the previous day as only 78 million shares changed hands on the KSE-100 index with most volumes recorded in small and mid-cap plays.

"(We) expect the market to inch upwards and revisit the important resistance at 42,000 early next week while institutional flows primarily from foreign investors will be vital in driving gains in the days ahead," the report added.

JS Global analyst Maaz Mulla said the market remained positive throughout the day, hitting an intra-day high of 677 points to close at 41,401.

"Bullish momentum returned as HBL (+5%) opened at its upper circuit on the back of a huge decline in the final penalty (on the New York branch), where the bank has agreed to pay $225 million instead of a potential amount of up to $630 million considered earlier," Mulla said.

Refinery stocks outshined the market as Attock Refinery (+4.68%), National Refinery (+3.95%), Pakistan Refinery (+4.51%) and Byco (+2.57%) gained relatively more than the benchmark index.

Oil marketing companies also contributed positively to the KSE-100 index where Pakistan State Oil (+2.52%) and Shell (+2.68%) were the major gainers.



Cement companies showed bullish momentum with Lucky Cement (+3.68%), DG Khan Cement (+2.36%), Fauji Cement (+0.37%) and Cherat Cement (+2.16%) cumulatively contributing 80 points to the index.

"Moving forward, we expect positivity to continue in the coming week and recommend investors to book profits on strength," the analyst said.

Overall, trading volumes fell slightly to 140 million shares compared with Thursday's tally of 147 million.

Shares of 388 companies were traded. At the end of the day, 263 stocks closed higher, 103 declined while 22 remained unchanged. The value of shares traded during the day was Rs8.4 billion.

TRG Pakistan was the volume leader with 18.3 million shares, gaining Rs1.23 to close at Rs39.80. It was followed by The Bank of Punjab with 14 million shares, gaining Rs0.72 to close at Rs10.18 and Azgard Nine with 13.2 million shares, gaining Rs0.93 to close at Rs14.49.

Foreign institutional investors were net sellers of Rs664 million during the trading session, according to data compiled by the National Clearing Company of Pakistan Limited.