Cement sector sends PSX to record

Benchmark KSE-100 index surges 869.77 points, settles at 67,756.04

Our Correspondent April 04, 2024
Segregation of client assets is critical as brokers have been penalised for using client money illegally. PHOTO: AFP


Pakistan Stock Exchange (PSX) on Wednesday soared to a new record high as it crossed the 67,700-point barrier with a surge of more than 850 points on the back of investor enthusiasm about the potential policy rate cut and strong cement sales.

The stock market followed an upward trajectory right after the commencement of trading. Bulls ruled the bourse in a rally fuelled by anticipation of monetary policy easing by the State Bank of Pakistan (SBP) following the decline in inflation to 20.68% for March 2024.

Selective buying of stocks, especially in the cement sector, helped the market to maintain its bullish momentum that allowed the KSE-100 index to rise nearly 870 points.

Throughout the day, the market stayed in the green, climbing steadily to its intra-day high of 67,873.21.

“Stocks closed at an all-time high on speculation about SBP’s policy easing after inflation fell to 20.7% in March,” said Ahsan Mehanti, MD of Arif Habib Corp.

“Upbeat data of cement sales that rose 3.85% year-on-year (YoY), increase in oil sales by 4% YoY and textile exports by 3% YoY in March, and a surge in global crude oil prices played the role of catalysts in bullish close at the PSX.”

At close, the benchmark KSE-100 index recorded an increase of 869.77 points, or 1.3%, and settled at 67,756.04.

Topline Securities CEO Mohammed Sohail stated “PSX hit another record high. Confidence further improved after seeing good progress on privatisation along with foreign portfolio investment in government papers”.

Cements stocks were in the limelight amid expectations of a rate cut in the coming months, he added.

Topline Securities, in its report, said Pakistan equities kicked off the day on a positive note and undoubtedly it was the cement sector that stole the limelight, spearheading the market’s upward trajectory.

Investors opted to buy the sector’s stocks like Maple Leaf Cement (+7.5%), Fauji Cement (+7.5%) and DG Khan Cement (+7.5%), which managed to close at their respective upper caps, it said.

Steel sector followed in the footsteps of cement industry where International Steels (+6.70%), Mughal Iron and Steel Industries (+5.05%), Amreli Steels (+3.97%) and International Industries (+3.56%) closed in the green.

The day’s positive contributors were Engro Corporation, Engro Fertilisers, Lucky Cement, Pakistan Petroleum, Oil and Gas Development Company and Dawood Hercules, which added 546 points.

The negative contributors were Meezan Bank, MCB Bank and Hub Power, which lost 64.89 points, Topline added.

Arif Habib Limited (AHL), in its review, said that strong moves in the cement sector saw the KSE-100 push further into the uncharted territory.

“Emergence of the cement sector which has been trading sideways since the start of the year can add another dynamic to the bull market,” it said.

Cement and steel names were positioning themselves to potentially become outperformers in the second quarter, AHL added.

JS Global analyst Muhammad Shuja Qureshi said that the KSE-100 index closed at the record high. “Cement sector led the rally with increase in both local and export sales in March,” he said.

“The positive momentum is expected to continue with profit-booking intervals,” the analyst added.

Overall trading volumes increased to 361.8 million shares against Tuesday’s tally of 239.6 million. The value of shares traded during the day was Rs11.9 billion.

Shares of 340 companies were traded. Of these, 208 stocks closed higher, 108 dropped and 24 remained unchanged.

Pakistan International Airlines Corp was the volume leader with trading in 38.2 million shares, losing Rs1.86 to close at Rs25.22. It was followed by Flying Cement with 21.5 million shares, gaining Rs0.89 to close at Rs8.79 and WorldCall Telecom with 20.98 million shares, gaining Rs0.03 to close at Rs1.38.

Foreign investors were net buyers of shares worth Rs644.6 million, according to the NCCPL.

Published in The Express Tribune, April 4th, 2024.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.



Replying to X

Comments are moderated and generally will be posted if they are on-topic and not abusive.

For more information, please see our Comments FAQ