Pakistan Stock Exchange (PSX) on Monday reached unprecedented levels in a record-breaking rally fuelled by robust institutional interest across various sectors on the back of encouraging economic indicators like a sharp fall in current account deficit and a notable rise in remittances.
In the morning, trading commenced with relative volatility, hitting the intra-day low at 58,999.30 points after the first hour. Afterwards, the market rose slightly but once again reached the intra-day low at midday.
However, at that point, the index climbed rapidly in a remarkable march towards north as investors took cue from a host of positive triggers.
Those included anticipation of approval of a staff-level agreement by the International Monetary Fund (IMF) executive board and subsequent disbursement of over $700 million. Discussions about investment in Pakistan during the prime minister’s visit to the UAE also played a pivotal role in triggering the market’s surge.
Resultantly, the index touched its intra-day high at 59,896.08 points in the final hour, just around 100 points shy of the 60,000 milestone. Key contributors to the positive momentum were bank and cement sectors.
“Stocks traded at a new all-time high amid institutional interest in stocks across the board as investors weighed strong economic data like the falling current account deficit and surging remittances,” said Arif Habib Corp MD Ahsan Mehanti.
“Over $700 million disbursement after the completion of IMF’s first quarterly review and expected deliberations about SIFC (Special Investment Facilitation Council) initiatives during PM’s visit to the UAE also played the role of catalysts in the PSX’s surge.”
At close, the benchmark KSE-100 index recorded a surge of 724.99 points, or 1.23%, and settled at 59,811.34.
Topline Securities, in its commentary, wrote that the week began on a positive note for Pakistan equities as the index recorded a significant rise of 725 points.
“Key contributors to the positive momentum were sectors such as banks and cement, with prominent stocks like Habib Bank, United Bank, MCB Bank, DG Khan Cement and Lucky Cement adding 388 points,” it said.
On the flip side, Mari Petroleum, Meezan Bank and Systems Limited erased some gains, resulting in a loss of 105 points, Topline added.
Read: PSX undeterred, reaches peak above 59k
Arif Habib Limited (AHL) wrote that the PSX was “less than 200 points shy of 60k, which was the weekly objective.”
Biggest contributors to the gains were Habib Bank (+7.5%), United Bank (+4.16%) and MCB Bank (+4.2%), it said, adding that major drags were Mari Petroleum (-2.47%), Meezan Bank (-1.58%) and Systems Limited (-1.35%).
JS Global analyst Mohammed Waqar Iqbal said that bullish trend continued owing to optimism surrounding the IMF board approval, MSCI rebalancing and expectations of interest rate cut.
“Going forward, we recommend investors to adopt a buy-on-dips strategy in the tech, exploration and production, and cement sectors,” the analyst added.
Overall trading volumes decreased to 657.6 million shares compared with Friday’s tally of 658.4 million. The value of shares traded during the day was Rs20.3 billion.
Shares of 391 companies were traded. Of these, 245 stocks closed higher, 121 dropped and 25 remained unchanged.
Kohinoor Spinning Mills was the volume leader with 109.4 million shares, gaining Rs0.98 to close at Rs4. It was followed by WorldCall Telecom with 43.3 million shares, losing Rs0.04 to close at Rs1.52 and Yousuf Weaving Mills with 22.8 million shares, gaining Rs0.56 to close at Rs4.24.
Foreign investors were net buyers of shares worth Rs1.17 billion, according to the NCCPL.
Published in The Express Tribune, November 28th, 2023.
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