Market watch: KSE-100 gains 96 points as uncertainty grips market

Benchmark index increases 0.25% to settle at 38,649.34

KARACHI: The stock market endured a volatile session on Friday as diverse expectations about the monetary policy announcement caused uncertainty at the bourse.

Street expectations about the benchmark interest rate ranging from a hike of up to 75 basis points to a fall of 25 to 50 basis points kept the KSE-100 index range bound and the market rose just 96 points.

The cement sector performed well because of the release of sales data, which displayed growth against expectations, but selling pressure restricted the price rise.

Bank, cement and power stocks led the volumes' table, where main contribution came from The Bank of Punjab, Fauji Cement and K-Electric.



Earlier, trading kicked off on a positive note, but volatility emerged soon afterwards, leading to multiple rises and falls before the end of the day. The index traded sideways for most part of the day, but managed to finish above the 38,600-point mark.

At the end of trading, the benchmark KSE 100-share Index recorded an increase of 96.39 points, or 0.25%, to settle at 38,649.34.

Arif Habib Limited, in its report, stated the market remained range bound during the day. Most volumes for the third consecutive session were recorded in Unity Foods' rights issue with trading in 25 million shares (18%) as against total market volumes of 138 million.

JS Global analyst Danish Ladhani said equities closed the week marginally positive with the KSE-100 index gaining 96 points.

"The bourse hit a high of +64 points and low of -232 points. The market remained range bound ahead of the State Bank of Pakistan's (SBP) announcement of monetary policy for the next two months, which was due after market hours," he said.

According to Ladhani, a deal with the International Monetary Fund (IMF) was around the corner, which would result in possible actions and implications for the economy.

Value buying was witnessed in the cement sector as expected cement sales for March 2019 showed a jump of 23% month-on-month to 4.11 million tons. Lucky Cement (+1.3%), DG Khan Cement (+1.3%) and Fauji Cement (+3.2%) were among the cement stocks that remained positive.



In the fertiliser sector, Engro (+0.9%), Fauji Fertiliser (+0.2%) and Engro Fertilisers (+0.1%) closed in the green zone.

Oil and Gas Development Company (+0.9%), Engro (+0.9%), MCB (+0.3%), Fauji Fertiliser (+0.2%), United Bank (+1.2%), Bank AL Habib (+0.4%), Pakistan Oilfields (+0.4%), Lucky Cement (+1.3%) and Engro Fertilisers (+0.1%) were among the top gainers that cumulatively contributed 87 points to positive close of the market.

Traded value stood at $37 million, up 18% and volumes stood at 138 million shares, up 4%.

"We recommend staying cautious in the short run due to the risk of further monetary tightening and inflationary pressure," the analyst added.

Overall, trading volumes increased to 137.7 million shares compared with Thursday's tally of 132.2 million. The value of shares traded during the day was Rs5.2 billion.

Shares of 328 companies were traded. At the end of the day, 177 stocks closed higher, 129 declined and 22 remained unchanged.

Unity Foods (R) was the volume leader with 25.3 million shares, gaining Rs0.32 to close at Rs2.69. It was followed by The Bank of Punjab (XD) with 9.5 million shares, gaining Rs0.12 to close at Rs13.02 and K-Electric with 7.7 million shares, gaining Rs0.1 to close at Rs5.59.

Foreign institutional investors were net buyers of Rs226.2 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.