Market watch: Relief rally continues as KSE-100 gains close to 400 points

Institutional investors lead the charge amid hopes of increased foreign buying

KARACHI: The benchmark KSE 100-share Index continued its recovery on Thursday as institutional investors cherry-picked stocks in financial business and oil sectors, which added almost 400 points.

Domestic investors also sent positive signals by ignoring the currently volatile political situation and investing in select index names.

Despite a lacklustre opening, stocks bounced back quickly to overcome the losses and gain over 400 points before dropping slightly to settle at 42,683.57 points, increasing by 373.45 points or 0.88% over Wednesday’s session.

According to Elixir Securities, Pakistan equities extended gains on Thursday in a volatile trading session with the benchmark KSE-100 index closing near 42,700 points.

“The market opened sideways, failing to carry yesterday’s momentum, but it gradually inched up on reported institutional interest primarily in financial, oil and select index names on hopes of better flows tomorrow (Friday) given FTSE rebalancing,” the report stated.

Moreover, domestic cherry-picking helped the market to ignore prevailing domestic politics while the Ministry of Finance’s assurance that no further IMF loans would be taken in the near term helped investors overcome concerns over currency depreciation.



Overall, activity in the wider market improved considerably with volumes on the KSE All-share Index crossing 200 million after remaining subdued over the past two weeks.

“We see the rally to continue tomorrow on the back of institutional flows with index attempting to test the important resistance level of 43,000,” the report added.

JS Global analyst Maaz Mulla said Attock Refinery (+5%), Engro Corp (+2.94%), Pakistan Oilfields (+1.77%), and Lucky Cement (+1.28%) were major leaders of the market and cumulatively contributed 101 points to the index.

“Volumes improved as 217 million shares were traded in the overall market, compared to 174 million shares on Wednesday, depicting a day-on-day increase of 25%,” he said.

“Worldcall telecom (+20%) was the volume leader for the day as 48 million shares of the tech stock changed hands. Engor Foods from the foods and personal care sector closed at its upper circuit (+5%).

The banking sector closed (+1.6%) higher with big banks such as MCB (+2.70%), Habib Bank (+1.97%) and National Bank (+1.82%) closing in the green zone. Oil and Gas Development Company (+0.04%), POL (+1.77%) and Pakistan Petroleum (+1.95%) from the oil exploration and production sector closed on the positive side as oil prices edged higher.

“Positivity has stemmed from attractive rates of many stocks, attracting investors into fresh buying. FTSE rebalancing is also inducing increased activity in the market.



“However, due to lack of substantial market triggers we recommend investors to book profits at these high levels,” he added.

Overall, trading volumes rose to 217 million shares compared with Wednesday's tally of 173 million.

Shares of 390 companies were traded. At the end of the day, 232 stocks closed higher, 130 declined while 28 remained unchanged. The value of shares traded during the day was Rs9.6 billion.

WorldCall Telecom was the volume leader with 47 million shares, gaining Rs0.58 to close at Rs3.48. It was followed by Azgard Nine with 22.9 million shares, gaining Rs0.29 to close at Rs13.68 and Aisha Steel Mills with 12.7 million shares, gaining Rs0.37 to close at Rs19.66.

Foreign institutional investors were net buyers of Rs815 million during the trading session, according to data compiled by the National Clearing Company of Pakistan Limited.