Market watch: KSE-100 makes smart recovery as Pakistan nears IMF loan deal

Benchmark index gains 550.23 points to settle at 37,337.87

KARACHI: The KSE-100 index made a handsome recovery on Friday as it advanced 550 points, supported by prospects of an imminent agreement with the International Monetary Fund (IMF) for a loan package.

Contrary to a sharp decline in previous sessions, the cement sector rebounded on the back of a significant decline in international coal prices, which prompted investors to place positive bets.

Finance Minister Asad Umar's announcement of near conclusion of a bailout deal with the IMF also helped revive investor confidence.

Earlier, trading began on a positive note, but the first session remained largely range bound and closed with a gain of 122 points.



The second session saw the index shoot up and maintain the rally till the day's end. The index crossed the 37,400-point mark several times but could not sustain it.

At the end of trading, the benchmark KSE 100-share Index recorded an increase of 550.23 points, or 1.5%, to settle at 37,337.87.

JS Global analyst Danish Ladhani said equities closed the week on a positive note with the benchmark KSE-100 index gaining 550 points.

"The bourse hit a high and low of +633 and -46 points respectively. The market bounced back in the second half as interest came from individuals and institutions after rumours that some government-owned institutions are likely to form a stock market support fund ahead of the MSCI review."

Lucky Cement (+5%), Pakistan State Oil (+4.7%), HBL (+1.8%), Bank AL Habib (+2.1%), Engro (+1.2%), DG Khan Cement (+5%) and Fauji Fertiliser (+1%) were among top stocks that cumulatively contributed 204 points to the market's rise.

Cement stocks moved up as Lucky Cement (+5%) and DG Khan Cement (+5%) touched their respective upper circuits.

National Bank (+5%) hit its upper lock in the financial sector and HBL (+1.8%) and MCB Bank (+0.7%) also closed in the positive zone.

Engro (+1.2%) and Fauji Fertiliser (+1%) in the fertiliser sector notched up gains. Among refineries, Attock Petroleum reported its 9MFY19 earnings per share of Rs23.99 with no cash payout.



Traded value came in at $38 million, up 21% and trading volumes stood at 189 million shares, up 32% from the previous trading session.

Furthermore, major contribution to the total market volumes came from The Bank of Punjab (+7.1%), Unity Foods (R) (13%), K-Electric (+3.6%), WorldCall Telecom (-3.5%) and Fauji Cement (+6.2%).

"We expect the equity market to remain choppy and volatile, and recommend investors to stay cautious in the short run ahead of the MSCI rebalancing and conclusion of IMF talks," the analyst added.

Overall, trading volumes increased to 189.4 million shares compared with Thursday's tally of 143.8 million. The value of shares traded during the day was Rs5.3 billion.

Shares of 352 companies were traded. At the end of the day, 282 stocks closed higher, 54 declined and 16 remained unchanged.

The Bank of Punjab (XD) was the volume leader with 22.8 million shares, gaining Rs0.9 to close at Rs13.61. It was followed by Unity Foods (R) with 20.8 million shares, gaining Rs0.3 to close at Rs2.55 and K-Electric with 14.8 million shares, gaining Rs0.18 to close at Rs5.23.

Foreign institutional investors were net sellers of Rs63 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.