PHOTO: PPI/FILE
KARACHI: Stocks rebounded sharply on Monday as the benchmark index soared past the 40,000-point barrier and finished first trading day of the week in the green.
The KSE-100 index opened up and continued to climb 944 points as investors shed their anxieties to buy stocks at attractive valuations. The positivity came in the light of prime minister's meeting with stock brokers, where it was discussed that the tumbling stock market should be given a helping hand in the shape of a bailout package.
The possibility of a bailout and ISPR's press conference that the government and the established democratic system needed to continue, which allayed fears of a conflict between the military and the government, turned the tide as activity at the bourse resumed.
At close, the benchmark KSE 100-share Index registered an increase of 944.61 points or 2.37% to finish at 40,791.39 points.
Elixir Securities, in its report, stated Pakistan equities managed to stage a notable comeback after days of lull as the market cheered and pinned hopes on a support package for equities by the government on the request of brokers and investment community.
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"The KSE-100 index ended the day with a healthy 2.4% gain, however, turnover did not match the excitement as only $57 million worth of shares changed hands on the KSE All-share Index against the average of $59 million last week, indicating cautious optimism among players," stated Elixir.
With reports of foreign buying, selective interest was also witnessed in recent laggards across cement, oil and banking sectors, which led the contributors' table, while most volumes were in penny names on possible retail buying.
"For the continuation of momentum to push the market past resistances on the upside, positive news about support fund will have to flow in the days ahead given noise on the political front and concerns over macros," the report added.
JS Global analyst Maaz Mulla said bulls ruled the local bourse, taking the KSE-100 index up by 945 points to close at 40,791.
"The market witnessed a recovery as value investors took the opportunity to buy stocks at attractive prices," Mulla said.
The recovery came after prime minister met with brokers at the weekend and listened to their demands.
Increase in heavyweight stocks including MCB Bank (+1.96%), Oil and Gas Development Company (OGDC, +3.41%), Lucky Cement (+5%), Pakistan State Oil (+3.77%) and Pakistan Oilfields (POL, +3.03%) steered the market.
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A rally was seen in the cement sector where Lucky Cement (+5%), Pioneer Cement (+5%), DG Khan Cement (+4.27%) and Maple Leaf Cement (+4.71%) increased the most. POL (+3.03%), OGDC (+3.41%) and Pakistan Petroleum Limited (+2.31%) were major gainers in the exploration and production sector.
The refinery sector closed positive where Attock Refinery (+5%) and National Refinery (+5%) hit their respective upper circuit.
"The market is expected to recover in coming days where we recommend investors to trade in main board stocks and take long-term positions in the same to benefit from undervalued stock prices," he added.
Overall, trading volumes fell to 124 million shares compared with Friday's tally of 153 million.
Shares of 388 companies were traded. At the end of the day, 296 stocks closed higher, 79 declined while 13 remained unchanged. The value of shares traded during the day was Rs7.1 billion.
Chakwal Spinning was the volume leader with 10.9 million shares, losing Rs0.94 to close at Rs5.30. It was followed by Aisha Steel Mills with 6.6 million shares, gaining Rs0.98 to close at Rs17.16 and TRG Pakistan with 5.5 million shares, gaining Rs1.62 to close at Rs34.12.
Foreign institutional investors were net buyers of Rs318 million during the trading session, according to data compiled by the National Clearing Company of Pakistan Limited.
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