Market watch: Bourse jumps on encouraging economic cues

Benchmark KSE-100 index gains 572.72 points to settle at 43,853.49

KARACHI:

Bullish trading continued at the Pakistan Stock Exchange on Tuesday as the benchmark KSE-100 index jumped nearly 600 points owing to encouraging economic cues.

The uptrend was driven by Asian Development Bank’s approval of the Economic Stabilisation Programme worth $1 billion, which created an optimistic outlook.

Increase in cement sales by 7% year-on-year in November indicated an improvement in economic activity, lending support to the KSE-100 index.

Investors brushed aside further fall of the rupee against the dollar and made fresh investment. They cherry-picked the stocks that had fallen to attractive levels following a bearish spell last week.

Tuesday’s trading session began with a spike and the index breached the 44,000-point barrier by midday. Pessimism about rupee depreciation played on investors’ mind, which wiped off some of the gains by the day’s end.

At close, the benchmark KSE-100 index recorded an increase of 572.72 points, or 1.32%, to settle at 43,853.49.

A report of Arif Habib Limited stated that the KSE-100 index had a positive day as the world drifted towards good news about reduced risk of Omicron variant of coronavirus, which helped international commodities and equities to rally across the globe.

“KSE-100 opened on a positive note and gained more than 785 points in intra-day trading as investor participated in exploration and production stocks amid expected resolution of circular debt issue in gas sector,” it said.

“The index closed at 43,853 points against 43,281 points, showing an increase of 572.72 points (+1.32% day-on-day).”

JS Global analyst Muhammad Mubashir said that after three consecutive volatile sessions, bulls made a comeback as the market touched intra-day high of 44,066 points.

The benchmark index closed at 43,853, up 573 points. Exploration and production companies were in the limelight throughout the day over news of a probable windfall. Oil and Gas Development Company and Pakistan Petroleum gained 4.2% and 3.8% respectively.

Traded volumes stood at 229 million shares where Telecard (+5.7%), TPL Properties (+7.4%), Treet Corp (+4.6%), Unity Foods (+7.5%) and Hascol Petroleum (+1.2%) contributed a cumulative 34%.

“Going forward, market performance is mainly dependent on the upcoming monetary policy announcement and FTSE rebalancing,” he said. “We recommend investors to adopt a buy-on-dip strategy in banking, exploration and production, and fertiliser sectors.”

Overall trading volumes rose to 229.4 million shares compared with Monday’s tally of 176.9 million. The value of shares traded during the day was Rs8.4 billion.

Shares of 347 companies were traded. At the end of the day, 247 stocks closed higher, 82 declined and 18 remained unchanged.

Telecard Limited XB was the volume leader with 27 million shares, gaining Rs0.79 to close at Rs14.7. It was followed by TPL Properties with 15.7 million shares, gaining Rs2.58 to close at Rs37.68 and Treet Corp with 14.8 million shares, gaining Rs1.82 to close at Rs41.77.

Foreign institutional investors were net sellers of Rs88 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.