Market watch: KSE-100 rises on return from holidays

Benchmark index gains 621.64 points to close at 45,796.31

KARACHI:

Bulls dominated trading at the Pakistan Stock Exchange (PSX) during the first trading session on Monday after the week-long Eid holidays amid renewed optimism.

Market players took cue from a host of positive developments during the week. Investor sentiment, which kept on fluctuating on the last trading day (May 6) before the long break, settled down due to clarity on the economic front.

A drop in Covid-19 cases coupled with positive expectations about the upcoming budget kept the investment climate attractive.

Lending further support to the rally, Morgan Stanley Capital International (MSCI) on Wednesday (May 12) conducted a semi-annual review to recompose its global indexes.

According to results of the May 2021 semi-annual review, it upgraded one Pakistani company to its emerging markets MSCI Global Standard Indexes from the MSCI Global Small Cap Indexes. Besides, it added one new company from the country to its small-cap indexes and deleted four companies from the two categories.

The news, in particular, encouraged market participants to make fresh investment and kept stock trading in the positive territory throughout the day.

Earlier, trading kicked off on a positive note and the benchmark KSE-100 index climbed steeply in early trading as a host of positive triggers encouraged investors to pour money into the market.

Later, the index dipped at regular intervals, however, the upward momentum still continued and the market ended the day with handsome gains.

At close, the benchmark KSE-100 index recorded an increase of 621.64 points, or 1.38%, to settle at 45,796.31 points.

Pak-Kuwait Investment Company Head of Research Samiullah Tariq told The Express Tribune that the benchmark KSE-100 index performed well on the back of a marked drop in coronavirus cases.

The research head added that the MSCI review and easing uncertainty before Eid holidays prompted investors to take fresh positions.

“Going forward, I expect the market to remain bullish during the week as investors have pinned high hopes on a favourable budget and a status quo in the monetary policy announcement due this month,” Tariq stated.

In its report, Arif Habib Limited stated that in the first trading session after a long Eid vacation, the market opened up by 347 points.

The MSCI emerging market review during the off period led to the inclusion of Lucky Cement and TRG Pakistan and deletion of Indus Motor, Packages Limited, Oil and Gas Development Company and NBP, which resulted in negative price performance in OGDC and positive price performance in Lucky Cement, it said.

The momentum kept the interest alive and the index posted gains with a cumulative addition of 622 points.

In addition, tech stocks continued the uptrend, particularly TRG Pakistan, NetSol and Avanceon, which fared well.

Sectors contributing to the performance included cement (+200 points), technology (+140 points), fertiliser (+55 points), textile (+35 points) and vanaspati (+34 points).

Individually, stocks that contributed positively to the index included TRG Pakistan (+135 points), Lucky Cement (+94 points), Unity Foods (+34 points), MCB (+32 points) and Maple Leaf Cement (+24 points).

Stocks that contributed negatively were Oil and Gas Development Company (-65 points), Pakistan Petroleum (-19 points), HBL (-8 points), National Refinery (-8 points) and Bank Alfalah (-6 points).

Overall trading volumes rose to 437.4 million shares compared with Thursday’s (May 6) tally of 245.6 million. The value of shares traded during the day was Rs20.3 billion.

Shares of 405 companies were traded. At the end of the day, 278 stocks closed higher, 105 declined and 22 remained unchanged.

WorldCall Telecom was the volume leader with 72.9 million shares, gaining Rs0.16 to close at Rs1.69. It was followed by K-Electric with 38.3 million shares, gaining Rs0.3 to close at Rs3.99 and Ghani Global Holdings with 35.96 million shares, gaining Rs1.04 to close at Rs39.81.

Foreign institutional investors were net buyers of Rs178.9 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.