Market watch: KSE-100 crosses 37,700 in range-bound session

Benchmark index gains 49.74 points to settle at 37,700.31

KARACHI:

Pakistan bourse remained slightly bullish on Tuesday as the KSE-100 index advanced 50 points and closed above 37,700 in a range-bound session.

Encouraging large-scale manufacturing data, which posted 20% month-on-month improvement, bolstered investor sentiment and pushed the index upwards. A bull-run in global stock markets gave further boost to investor confidence.

An uptrend in global crude oil prices, which rose to four-month highs, also lent support to the market, however, many oil stocks closed in the red.

Earlier, trading began on an optimistic note, however, the index succumbed to the selling pressure shortly afterwards as market participants divested their investment from cement and pharmaceutical sectors.

Large-scale manufacturing data acted as the much-needed positive trigger and fuelled the rally. Trading largely remained range bound, however, upbeat investors helped the index to close with some gains.

At close, the benchmark KSE-100 index recorded an increase of 49.74 points, or 0.13%, to settle at 37,700.31 points.

Arif Habib Limited, in its report, stated that the market traded in a range of -282 points and +288 points and closed the session up by 50 points.

“Amid expectations of impending correction, the index is moving around current levels with a tilt towards index heavyweights such as Hubco that helped prevent a slide, which would otherwise have dented investor sentiment,” it said.

The index opened on a positive note with +98 points and went further up to +183 points on the back of buying activity in cement, exploration and production sectors. However, selling pressure in banking, cement, fertiliser and steel sectors brought the index down later.

The index rebounded again with buying interest in Hubco that took its stock price to the upper circuit.

Besides, increase in international crude oil prices helped PSO, Pakistan Petroleum and Pakistan Oilfields to post price gains. Among fertiliser stocks, Engro performed well and posted decent gains.

The technology sector topped the volumes with trading in 71.7 million shares, followed by cement firms (58.2 million) and power companies (43.3 million).

Among individual stocks, TRG Pakistan recorded trading in 28.6 million shares, followed by Hascol Petroleum (25.9 million) and Hum Network (17.5 million), the report added.

JS Global analyst Maaz Mulla said the market remained volatile throughout the day, touching intra-day high of +288 points and intra-day low of -282 points. The index closed at 37,700, up 50 points from Monday’s close.

The traded value stood at $116 million while volumes came in at 457 million shares, down 17%.

Profit-booking was witnessed in the cement sector where Cherat Cement (-5%), Maple Leaf Cement (-3.1%), DG Khan Cement (-2.9%) and Pioneer Cement (-1%) lost ground.

The pharmaceutical sector followed the same trend where Searle (-2.4%), Ferozsons Laboratories (-2.8%), IBL HealthCare (-2.7%), GlaxoSmithKline (-1.5%) and AGP Limited (-1.6%) closed lower.

Investor interest was witnessed in the power sector for the second consecutive day where Kapco (+7.5%), Hubco (+6%), Nishat Power (+5%) and Nishat Chunian Power (+1.7%) remained in the green zone.

“Moving forward, we recommend investors to book profit and wait for a dip for fresh buying. Our top picks are cement, steel and refinery stocks,” the analyst said.

Overall, trading volumes contracted to 457.2 million shares compared with Monday’s tally of 553.8 million. The value of shares traded during the day was Rs19.5 billion.

Shares of 405 companies were traded. At the end of the day, 149 stocks closed higher, 233 declined and 23 remained unchanged.

TRG Pakistan was the volume leader with 28.6 million shares, gaining Rs0.05 to close at Rs39.3. It was followed by Hascol Petroleum with 25.9 million shares, losing Rs0.27 to close at Rs13.73 and Hum Network with 17.5 million shares, gaining Rs0.97 to close at Rs11.18.

Foreign institutional investors were net sellers of Rs202.3 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.