Market watch: Despite foreign selling, index soars for 12th successive session

Benchmark KSE-100 index gains 428.16 points to settle at 36,618.57

Our Correspondent July 13, 2020
Trading volumes rose to 469 million shares compared with Friday’s tally of 292.7 million. PHOTO: FILE


The stock market continued to remain bullish on Monday as the benchmark index marked the 12th successive session in the green.

The flattening curve of coronavirus infections in addition to the incentives announced for the construction sector bolstered investors’ confidence.

The KSE-100 index shot up from the moment trading began and maintained the uptrend as investors also took cue from the bull-run in global equity markets. The prime minister’s initiative to boost the housing market, including 5% bank lending portfolio, sparked buying interest in cement, steel and banking stocks.

Moreover, the improving foreign exchange reserves and record high remittances from overseas Pakistanis also acted as a catalyst in the positive close of the bourse.

At close, the benchmark KSE-100 index recorded an increase of 428.16 points, or 1.18%, to settle at 36,618.57 points.

According to an AHL Research report, “The first day of the resumption of pre-Covid trading hours brought higher volumes, which touched 468 million shares, slightly higher than those on Thursday. This is the highest volume so far in CY20.”

The report added that the KSE-100 index moved in one direction, gaining 532 points during intra-day trading. The cement sector led the rally with Maple Leaf Cement registering the highest trading volumes in recent times. A majority of the cement sector stocks traded at and near their upper circuits.

“The recently announced housing scheme has brightened prospects for cement companies in addition to the declining coal prices and increase in retail prices per bag.”

Among oil and gas marketing companies, PSO and SSGC stood tall with higher volumes and price appreciation. A similar bullish sentiment was noted in the steel sector, which saw Amreli Steels and Mughal Iron and Steel hit their upper circuits.

Stocks that contributed positively to the index included Lucky Cement (57 points), PSO (42 points), DG Khan Cement (34 points), Meezan Bank (21 points) and Cherat Cement (19 points).

Stocks that contributed negatively were Pakistan Services Limited (7 points), EFU General Insurance (6 points), Pakistan Tobacco (5 points), Hubco (5 points) and The Bank of Punjab (5 points).

JS Global analyst Maaz Mulla said the benchmark index opened positive and touched a high of 532 points as institutional participation was witnessed in main board stocks.

The cement sector continued its upward trend from last week where DG Khan Cement (+7.3%), Cherat Cement (+7.5%), Pioneer Cement (+7.1%), Maple Leaf Cement (+5.1%), Fauji Cement (+4.8%) and Lucky Cement (+4%) were the major movers.

The steel sector also enjoyed a similar trend where Mughal Iron and Steel (+7.5%), Amreli Steels (+7.5%), International Steels (+4.3%) and International Industries (+5.3%) closed in the green.

“Moving forward, we expect the market to follow the same trend. Our top picks are cement, steel and oil marketing sectors,” he added.

Overall, trading volumes rose to 469 million shares compared with Friday’s tally of 292.7 million. The value of shares traded during the day was Rs18.6 billion.

Shares of 403 companies were traded. At the end of the day, 236 stocks closed higher, 151 declined and 16 remained unchanged.

Maple Leaf Cement was the volume leader with 76.5 million shares, gaining Rs1.50 to close at Rs30.78. It was followed by Pak Elektron with 21.9 million shares, gaining Rs1.20 to close at Rs29.07 and TRG Pakistan with 21.2 million shares, gaining Rs1.47 to close at Rs36.66.

Foreign institutional investors were net sellers of Rs1.12 billion worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.



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