PSX soars as PM trip gives impetus

KSE-100 index surges 1,505.55 points, settles at 66,223.63

KARACHI:

Pakistan Stock Exchange (PSX) on Friday displayed extraordinary performance that sent the KSE-100 index to a new all-time high above 66,000 points, as it drew major strength from Caretaker Prime Minister Anwaarul Haq Kakar’s visit for the launch of a Rs30 billion Ijara Sukuk.

In his speech, the PM cited improvement in Pakistan’s fiscal and external accounts and attributed the bullish spree at the bourse to an improved economy, extensive participation of foreign investors, high returns and a stable exchange rate. The index gained over 1,500 points during the day.

Soon after trading started in the morning, the KSE-100 made substantial gains and the momentum continued over optimism that the International Monetary Fund’s (IMF) executive board would meet on January 11 for approval of the disbursement of a $700 million loan tranche.

As a result, the market reached its intra-day high at 66,273.73 points towards the close of trading. Investors particularly showed interest in sectors like cement, chemical, commercial banks, fertiliser, and oil and gas.

“Stocks closed at a new record amid rupee stability and government’s plans to auction Ijarah Sukuk worth billions to retail investors to diversify funding,” said Arif Habib Corp MD Ahsan Mehanti.

“Falling external debt, positive outcome of SIFC initiatives and expectations of a current account surplus in November 2023 played the role of catalysts in new record close at the bourse.”

At close, the benchmark KSE-100 index recorded hefty gains of 1,505.55 points, or 2.33%, and settled at 66,223.63.

Topline Securities wrote that bull-run threw the 66,000 mark out of the door for Pakistan equities as investors were enjoying a phenomenal rally, which was still unstoppable despite gaining 24.6k points (over 59%) in FY24 to date.

Continuing its strong momentum, the KSE-100 index commenced the day with +300 points and finished trading with a rise of 1,505 points, it said.

“Friday’s rally can be attributed to the anticipation surrounding the upcoming IMF board meeting scheduled for January 11, which is set to review and approve the disbursement of a $700 million tranche.”

The banking sector was 4% higher on a day-on-day basis. MCB Bank, Habib Bank, Bank Alfalah and United Bank added 523 points to the index, Topline added.

Read: PM Kakar credits all stakeholders for economic revival

Arif Habib Limited (AHL), in its report, said that there was another stellar 7.3% week-on-week (WoW) rise for Pakistan stocks that closed above 66k.

Positive news regarding the IMF’s executive board meeting on January 11 to consider final approval for the disbursement of $700 million tranche under its loan programme lifted bullish sentiment further, it said.

Huge participation was witnessed in the Ijarah Sukuk auction at the PSX from institutions, banks, insurance firms, funds, high-net-worth individuals and retail investors.

Banks were big contributors to the KSE-100 index which included MCB Bank (+7.5%), Habib Bank (+6.96%) and Bank Alfalah (+5.84%), AHL added.

JS Global analyst Mubashir Anis Naviwala said that the bourse crossed the 66,000 level, gaining 4,532 points in a week. “Expectations about economic revival and foreign flows further boosted the bullish trend,” he said.

“Going forward, we expect the bullish trend to continue and recommend investors to view any downside as an opportunity to buy stocks in banking, cement and E&P sectors,” the analyst added.

Overall trading volumes remained nearly flat around 1.33 billion shares against Thursday’s tally of 1.32 billion. The value of shares traded during the day was Rs33.4 billion.

Shares of 395 companies were traded. Of these, 257 stocks closed higher, 127 dropped and 11 remained unchanged.

K-Electric was the volume leader with trading in 342.5 million shares, gaining Rs0.46 to close at Rs4.43. It was followed by WorldCall Telecom with 98.6 million shares, gaining Rs0.05 to close at Rs1.67 and Pakistan Telecommunication Company with 58.7 million shares, gaining Rs0.93 to close at Rs9.65.

Foreign investors were net buyers of shares worth Rs436.2 million, according to the NCCPL.

Published in The Express Tribune, December 9^th, 2023.

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