Market watch: KSE-100 soars over 900 points on Chinese support hopes

Benchmark index increases 2.33% to settle at 40,556.45

KARACHI: The KSE-100 index advanced beyond expectations on Friday and climbed over 900 points as investors anticipated a positive outcome from Prime Minister Imran Khan's upcoming visit to China, which may announce some financial assistance for Pakistan to avert a balance of payments crisis.

Saudi Arabia has already agreed on giving a $6-billion financial package to Pakistan to help shore up the dwindling foreign currency reserves.

With such positive news reports about the economy, the benchmark index soared past the 40,500-point barrier and ended the third consecutive day in the black.

Earlier, the trading started on a positive note, but soon it turned lacklustre and the first half closed flat. In the second half, the index exhibited an exceptional performance and took a U-turn as buying spree prevailed on the back of strong investor sentiments.

At the end of trading, the benchmark KSE 100-share Index recorded an increase of 924.54 points or 2.33% to settle at 40,556.45.



Arif Habib Limited in its report stated that the index registered one of the highest volumes after May 2017, which was known for huge foreign selling due to status upgrade for Pakistan from the MSCI Frontier to Emerging Markets index.

"For bank, steel, fertiliser, cement and exploration and production stocks, the volumes surged and prices also increased significantly," the report added. "Anticipation of Chinese support worked as a major driver and an optimism for market players."

Institutional buying led the index from the initial mixed trend to a clear uptrend with close to 1,000-point jump in the index, it said.

Stocks that contributed significantly to the volumes included The Bank of Punjab, Lotte Chemical, WorldCall Telecom, Pak Elektron and K-Electric, accounting for 32% of the total volumes.

Stocks that contributed positively to the index included Oil and Gas Development Company (100 points), Pakistan Petroleum (96 points) and Habib Bank (96 points). Stocks that contributed negatively were Hubco (33 points), Colgate Palmolive (16 points) and Indus Motor (7 points), the report added.



Overall, trading volumes increased to 368.3 million shares compared with Thursday's tally of 343.9 million. The value of shares traded during the day was Rs13.98 billion.

Shares of 396 companies were traded. At the end of the day, 278 stocks closed higher, 104 declined and 14 remained unchanged.

The Bank of Punjab was the volume leader with 53.5 million shares, gaining Rs0.16 to close at Rs12.12. It was followed by Lotte Chemical with 25 million shares, gaining Rs0.7 to close at Rs19.92 and K-Electric Limited with 14.93 million shares, gaining Rs0.18 to close at Rs5.99.

Foreign institutional investors were net sellers of Rs387.8 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.