Market watch: Karachi package helps lift stock market

Benchmark KSE-100 index gains 272.75 points to settle at 42,295.75

KARACHI:

Pakistan Stock Exchange (PSX) reversed trend on Monday and the benchmark KSE-100 index rose more than 250 points as investors cheered the Karachi package.

Prime Minister Imran Khan on Saturday announced a historic package of Rs1.1 trillion for Karachi’s transformation following the devastation caused by the recent record-breaking rain spell and urban flooding, which bolstered investors’ sentiment and encouraged them to make fresh buying.

Lending further support to the KSE-100 index was the recovery in global and regional markets, coupled with a stable rupee.

Earlier, trading began on a bullish note and the index climbed steadily. Later in the day, the trading remained range bound and profit-booking towards the end erased some of the gains.

At close, the benchmark KSE-100 index recorded an increase of 272.75 points, or 0.65%, to settle at 42,295.75 points.

Arif Habib Limited, in its report, stated that the market opened on a positive note and added a total of 377 points during the session.

Oil marketing, refinery, chemical, cement, steel and pharma sectors performed well whereas the exploration and production sector went down on the back of a decline in international crude oil prices.

The fertiliser sector performed well due to expectation the government would defer gas infrastructure development cess (GIDC) collection, the report added.

The cement sector recorded highest volumes of 120.1 million shares, followed by banks (74.8 million) and technology firms (65.7 million).

Individually, stocks that contributed positively to the index included Lucky Cement (+41 points), Systems Limited (+33 points), Fauji Fertiliser (+28 points), Hubco (+23 points) and Hascol Petroleum (+22 points).

Stocks that contributed negatively were Pakistan Oilfields (-21 points), HBL (-13 points), Pakistan Petroleum (-10 points), Oil and Gas Development Company (-8 points) and Mari Petroleum (-8 points).

JS Global analyst Maaz Mulla said bears were defeated in Monday’s session as the market closed in the green zone. The market remained in the green throughout the day and closed at 42,296, up 273 points.

Overall volumes stood at 749 million shares while traded value came in at $143 million, he added.

“Power Cement (+10.2%), Pakistan International Bulk Terminal (+3.4%), Hascol Petroleum (+7.5%) and JS Bank (+13.7%) cumulatively contributed about 211 million shares to the total volume.”

The refinery sector continued its upward march of last week where National Refinery (+3.2%), Attock Refinery (+1.3%) and Pakistan Refinery (+7.5%) were the major movers, Mulla stated.

The steel sector also depicted a similar trend where Ittefaq Iron Industries (+7.5%), Crescent Steel (+6.8%), International Steels (+2.8%), Aisha Steel Mills (+1.6%) and International Industries (+1%) were in the green region.

“Going forward, we expect the market to continue the similar trend and recommend investors to see any upside as an opportunity to sell. However, we recommend to see any downside as an opportunity to buy in the cement, steel, consumer and banking sectors,” the analyst said.

Overall, trading volumes fell to 748.9 million shares compared with Friday’s tally of 758.1 million. The value of shares traded during the day was Rs23.7 billion.

Shares of 434 companies were traded. At the end of the day, 273 stocks closed higher, 134 declined and 27 remained unchanged.

Power Cement was the volume leader with 72.4 million shares, gaining Re1 to close at Rs10.85. It was followed by Pakistan International Bulk Terminal with 57.3 million shares, gaining Rs0.43 to close at Rs13.22 and Hascol Petroleum with 45.99 million shares, gaining Rs1.61 to close at Rs23.15.

Foreign institutional investors were net buyers of Rs12.5 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.