Market watch: KSE-100 wraps up FY20 on positive note

KARACHI:

The stock market staged a modest rally on the last trading session of fiscal year 2019-20 and the KSE-100 index advanced 240 points on strengthening investor confidence after China parked $1.3 billion in the State Bank of Pakistan (SBP).

The approval of federal budget 2020-21 in late hours of Monday proved positive for the bourse and lent further support to the uptrend.

Overall, the session was marked by optimism as market participants pinned hopes on the Federal Board of Revenue, which was expected to undertake relief measures from July 1.

Earlier, trading kicked off on a positive note, however, the gains were erased in the afternoon and the index fell into the negative territory. Strong investor sentiment triggered cherry-picking, which continued for the rest of the day, helping the market post gains and end the fiscal year on a positive note.

At close, the benchmark KSE-100 index recorded an increase of 240.12 points, or 0.7%, to settle at 34,421.92 points.

Arif Habib Limited, in its report, stated that the financial year ended on a positive note with the index gaining 240 points at 34,422.

Trading volumes also improved for the day, however, the focus was still on mark-to-market valuation of securities in investor portfolios.

Among banking sector stocks, HBL and NBP recorded high volumes with small price gains. Comparatively, MCB posted better gains but volumes remained thin.

Cement sector stocks, which performed well in the past two sessions, remained muted. The exploration and production sector also lacked any excitement, which coincided with slight changes in international crude oil prices.

The refinery sector led the volumes with trading in 43.3 million shares, followed by oil and gas marketing companies (27.4 million) and technology firms (27.1 million).

JS Global analyst Danish Ladhani said the benchmark KSE-100 index extended its gains, touching a high of +243 points and a low of -36 points. It closed at 34,422, up 240 points. “The market traded sideways during Tuesday’s session,” he said.

Pakistan Petroleum (-1.1%) and Pakistan Oilfields (-0.3%) in the exploration and production sector remained in the negative territory as crude oil in the international market continued to drop on demand worries.

The financial sector was the major player during the day where HBL (+1.1%), UBL (+2.3%) and MCB (+5.5%) moved up.

Fauji Fertiliser (+0.8%), Oil and Gas Development Company (-1.1%), HBL (+1.1%), MCB (+5.5%), Lucky Cement (+0.3%) and UBL (+2.3%) were the index movers.

“Going forward, we expect the market to remain range bound and recommend investors to sell on strength,” the analyst said.

Overall, trading volumes rose to 223.3 million shares compared with Monday’s tally of 156.9 million. The value of shares traded during the day was Rs7.5 billion.

Shares of 369 companies were traded. At the end of the day, 171 stocks closed higher, 179 declined and 19 remained unchanged.

Pakistan Refinery (R) was the volume leader with 40 million shares, losing Rs0.34 to close at Rs0.17. It was followed by Sui Southern Gas Company with 14.6 million shares, gaining Rs0.62 to close at Rs13.34 and TRG Pakistan with 13.7 million shares, gaining Rs0.97 to close at Rs28.24.