The Pakistan Stock Exchange registered a handsome rally on Thursday as clarity over the US presidential election helped the benchmark KSE-100 index soar nearly 800 points and power past the 41,000-point mark.
The market had a spillover impact of the uptick in global and regional equities after Joe Biden took lead over incumbent President Donald Trump in the election.
In addition, the government’s efforts to resolve the circular debt issue helped keep the index in the green zone. On Wednesday, the Economic Coordination Committee formed a panel aimed at settling the ballooning circular debt.
During the day, stock investors also took cue from consistent appreciation of the rupee against the US dollar and took fresh positions. Index-heavy cement, financial and oil sectors turned attractive and received modest investment.
The bullish investor sentiment helped the market start trading with a spike, triggering a buying spree that continued for the rest of the day. Although a few dips were witnessed from time to time, they were corrected aptly.
The upward trend accelerated towards the close of trade and inflated the market’s gains.
At close, the benchmark KSE-100 index recorded an increase of 789.34 points, or 1.96%, to settle at 41,071.3 points.
Arif Habib Limited, in its report, stated that Biden’s win, based on statistics although not declared yet, provided global markets some relief and stability and propped up investor sentiment.
“Resultantly, international crude oil prices stabilised near the highs touched in the past couple of sessions,” he said. “Regional stock markets followed suit and traded +2.5% on average.”
Pakistan’s bourse nudged along while trading in the positive zone in the entire session and added a total of 803 points during the day. It closed up by 789 points.
Buying activity was observed across the board, however, exploration and production and oil and gas marketing sectors contributed the most to the index, it said.
JS Global analyst Maaz Mulla said recovery was witnessed at the Pakistan bourse where the index touched intraday high of +803 points and closed at 41,071, up 789 points.
Major contribution to the total market volume came from Pakistan Refinery (+7.4%), Unity Foods (+0.5%), Pakistan International Bulk Terminal (+2.7%) and Hascol Petroleum (+3.3%) with a cumulative 104 million shares traded.
The exploration and production sector experienced a rally where Pakistan Oilfields (+4.1%), Pakistan Petroleum (+4.9%) and Oil and Gas Development Company (+3.8%) were the major movers as crude oil prices recovered in the international market.
Moreover, the refinery sector also enjoyed the upward rally where Attock Refinery (+5.8%), National Refinery (+5.2%) and Pakistan Refinery (+7.4%) gained ground.
Among cement stocks, Lucky Cement (+1.7%), Cherat Cement (+1%), Pioneer Cement (+1.6%), Fauji Cement (+1.1%), Maple Leaf Cement (+0.7%) and DG Khan Cement (+0.8%) moved higher.
“Furthermore, the market shall remain bullish ahead but with uncertainty amid politics and increasing coronavirus cases. Hence, we recommend investors to book profit on the higher side and wait for any sharp dip to accumulate value stocks,” the analyst said.
Overall, trading volumes dropped to 356.6 million shares compared with Wednesday’s tally of 427.8 million. The value of shares traded during the day was Rs11.7 billion.
Shares of 365 companies were traded. At the end of the day, 252 stocks closed higher, 91 declined and 22 remained unchanged.
Pakistan Refinery was the volume leader with 33.2 million shares, gaining Rs1.33 to close at Rs19.26. It was followed by Unity Foods with 32.3 million shares, gaining Rs0.11 to close at Rs23.31 and Pakistan International Bulk Terminal with 19.4 million shares, gaining Rs0.34 to close at Rs12.92.
Foreign institutional investors were net buyers of Rs266.2 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.
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