KARACHI: The KSE-100 index soared on Thursday and gained close to 800 points as investors displayed strong sentiment owing to easing of political tensions.
On the other hand, improving macroeconomic indicators finally began reflecting on the bourse and lent support during the trading session.
In the morning, trading began with a spike and the uptrend continued for most of the early trading, however, the index inched downwards at midday. Nevertheless, strong investor sentiment wiped out the losses and helped the index recover to close above the 41,000-point mark.
At close, the benchmark KSE 100-share Index recorded an increase of 799.47 points, or 1.98%, to settle at 41,127.79.
“The market has entered a correction phase following ups and downs in previous sessions,” said Arif Habib Limited Head of Research Samiullah Tariq while talking to The Express Tribune.
“The market has been rallying since trading at 29,000 points and the trend is expected to continue in future sessions.”
He added that political tensions and other domestic matters impacted the bourse in previous sessions but it still managed to recover as soon as they eased. Tensions along the border with India particularly had an impact on trading at the bourse, he added.
On the other hand, improvement in macroeconomic indicators began reflecting in the stock market, the analyst said.
He was of the view that the bullish rally was the result of increasing foreign exchange reserves and a declining current account deficit.
Arif Habib Limited, in its report, stated that the stock market moved up 820 points primarily due to year-end closing that required financial institutions to manage the equity portfolio to avoid impairment.
“Buying activity was seen across the board, but was mainly concentrated in the oil and gas chain, including exploration and production sector stocks among which Oil and Gas Development Company (OGDC) traded near its upper circuit,” it said. “Similarly, price gains were noted in refineries and oil marketing companies’ sectors.”
The banking sector was no different with HBL and UBL being major performers.
The technology sector led the volumes with trading in 33.6 million shares, followed by oil and gas marketing companies (27.7 million) and vanaspati manufacturers (27.2 million).
Among individual stocks, Unity Foods saw trading volumes of 27.2 million, followed by WorldCall Telecom (21 million) and Hascol (R) (17.8 million), the report said.
Overall, trading volumes increased to 236.8 million shares compared with Tuesday’s tally of 236.2 million. The value of shares traded during the day was Rs7.95 billion.
Shares of 370 companies were traded. At the end of the day, 280 stocks closed higher, 74 declined and 16 remained unchanged.
Unity Foods was the volume leader with 27.2 million shares, gaining Re1 to close at Rs15.97. It was followed by WorldCall Telecom with 21 million shares, gaining Rs0.07 to close at Rs1.27 and Hascol (R) with 17.8 million shares, gaining Re1 to close at Rs9.54.