Market watch: Oil and gas companies drive stocks upwards

Benchmark KSE-100 Index gains 0.58% to settle at 40,548.83

KARACHI: The stock market made a significant recovery on Tuesday on the back of support provided by the heavyweight oil and gas sector.

Higher international crude oil prices and inauguration of the second liquefied natural gas (LNG) terminal at Port Qasim were the main driving forces behind the growth in the oil and gas sector and the overall stock market.

At close, the benchmark KSE 100-share Index registered an increase of 231.90 points or 0.58% to settle at 40,548.83.

Topline Securities, in its report, stated that Pakistani equities saw a promising start to the day where KSE-100 index surged above 40,500.

"Some profit taking was seen mid-day due to news that accountability courts rejected Finance Minister Ishaq Dar's request seeking exemption from court appearances while also ordering start of proceedings to declare him a fugitive. However, low of 40,300 re-instilled positive momentum and market recovered, managing to close near session highs; up by 232pts/0.6% to 40,549 points.

"Some concerns about the economy were allayed as government floated timeline of road shows for issuance of Eurobond/Sukuk, while S&P also gave "B" rating for Pakistan's proposed foreign debt issuance, which is better than rating of "B-" for previous issues.



"Top index point performers were MCB (+2.3%), OGDC (+1.7%), PPL (+1.1%), PAKT (+5%) & SNGP (+2.6%) contributing 126 points while PSO (-1.6%), KAPCO (-0.5%), NCPL (-5%), NPL (-5%) & DAWH (-0.8%) withheld 40 points.

"On the sector front; banks added 78 points, while E&Ps contributed 64 points and fertilisers 26 points while on the flip side power held back 19 points as investors were concerned over news of shutdown of furnace oil based power plants.

JS Global analyst Danish Ladhani said Pakistani equities kicked off the session on a positive note, but trading remained dull. The benchmark index hit an intraday high of +287 points and intra-day low of -45 points to close at 40,549 (+232 points).

“Traded volumes were up 8% while value was up 20%. TRG Pakistan (+1.84%) and Pak Elektron (+2.50%) were primary contributors to the total market volume,” the analyst said.

Mixed sentiments were witnessed in the banking sector as heavyweights Habib Bank (+0.55%) and United Bank (+0.66%) closed in the green zone whereas Faysal Bank (-0.66%) and Silkbank (-1.47%) closed in the red zone.



Sui Northern Gas Pipelines (+2.31%) and Sui Southern Gas Company (+2.24%) rose following inauguration of the second LNG terminal by Prime Minister Shahid Khaqan Abbasi at Port Qasim, which was built at a cost of Rs50 billion.

The oil exploration and production sector moved higher with Pakistan Oilfields (+0.55%), Pakistan Petroleum (+1.04%) and Oil and Gas Development Company (+1.69%) being major movers of the sector amidst high international crude oil prices.

“Moving forward, we recommend investors to stay sidelined and wait for clarity on the prevailing political situation,” he added.

Overall, trading volumes rose to 101 million shares compared with Monday's tally of 94 million.

Shares of 334 companies were traded. At the end of the day, 157 stocks closed higher, 154 declined while 23 remained unchanged. The value of shares traded during the day was Rs5.2 billion.

Unity Foods was the volume leader with 12.9 million shares, gaining Rs1.00 to close at Rs4.76. It was followed by TRG Pak with 7.3 million shares, gaining Rs0.65 to close at Rs35.89 and Pak Elektron with 4.9 million shares, gaining Rs1.37 to close at Rs56.27.

Foreign institutional investors were net sellers of Rs56.5 million during the trading session, according to data compiled by the National Clearing Company of Pakistan.