Market watch: Bulls dominate, KSE-100 surges over 800 points

Benchmark index rises 3.09% to settle at 28,109.57


​ Our Correspondent March 27, 2020
Benchmark index rises 3.09% to settle at 28,109.57. PHOTO: AFP

KARACHI: Bulls maintained their grip on the Pakistan stock market for the second consecutive day as the benchmark KSE-100 index powered past the 28,000-point mark in a rally that saw a surge of 842 points on Friday.

The uptrend was fuelled by the measures taken by the State Bank of Pakistan (SBP) and Pakistan Banks Association (PBA), coupled with recovery in Asian markets.

Moreover, speculation about likely approval of $1.4 billion in an International Monetary Fund (IMF) loan for economic relief further strengthened investors’ sentiment.

However, the market experienced pressure during intra-day trading over rupee’s volatility against the US dollar.

At close, the benchmark KSE-100 index recorded an increase of 842.37 points, or 3.09%, to settle at 28,109.57.

Arif Habib Limited, in its report, stated that the market opened on a negative note with a loss of 20 points, went further down by 110 points and made a gradual recovery.

“Regulatory measures have been taken by the SBP and PBA regarding margins on shares as collateral. Moreover, relaxation in terms of classification of doubtful and bad debt on banks’ financial statements caused much clarity for investors,” it said.

Furthermore, stocks of steel and cement sectors, which had one of the highest leverages among listed industries, made a swift recovery. “Better performance in regional markets also helped boost investor confidence,” it added.

Meanwhile, the power sector topped the volumes table with trading in 44.7 million shares, followed by cement companies (27.7 million) and banks (18.7 million).

Stocks that contributed positively to the index included Engro (+107 points), Hubco (+92 points), MCB Bank (+76 points), UBL (+65 points) and Lucky Cement (+65 points).

Stocks that contributed negatively were HBL (-29 points), OGDC (-11 points), EFU General Insurance (-9 points), Archroma Pakistan (-6 points) and Abbott Laboratories (-3 points).

JS Global analyst Maaz Mulla said PSX made some recovery in Friday’s trading where the market touched intra-day high of +1,006 points and closed at 28,109 (up 842 points).

“Positive sentiment can be attributed to attractive valuations of the KSE-100 index stocks. Overall volumes stood at 169 million shares while traded value came in at $25 million,” he stated.

“Moreover, though the US dollar appreciated against Pakistani rupee in intra-day currency market, it closed below previous day’s level.”

The cement sector enjoyed a rally where DG Khan Cement (+6.9%), Lucky Cement (+6.8%), Maple Leaf Cement (+7.5%), Pioneer Cement (+7.5%), Fauji Cement (+7.8%) and Cherat Cement (+7.4%) closed near their respective upper circuits.

The banking sector saw heavy participation where UBL (+6.9%), MCB Bank (+6.4%), Bank Alfalah (+2.5%) and The Bank of Punjab (+1.7%) closed in the green while HBL (-1.8%) remained in the red.

“Going forward, we expect the market to remain bearish as the coronavirus situation prevails across the globe and recommend investors to remain cautious,” he said.

Overall, trading volumes decreased to 169.4 million shares compared with Thursday’s tally of 186.7 million. The value of shares traded during the day was Rs4.2 billion.

Shares of 304 companies were traded. At the end of the day, 228 stocks closed higher, 56 declined and 20 remained unchanged.

K-Electric was the volume leader with 41.2 million shares, losing Rs0.04 to close at Rs2.71. It was followed by Unity Foods with 11.3 million shares, gaining Rs0.48 to close at Rs8.87 and Hascol Petroleum with 10.5 million shares, losing Rs0.04 to close at Rs10.92.

Foreign institutional investors were net sellers of Rs410.5 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.

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