PSX scales new highs on upbeat sentiment

KSE-100 index surges 713.61 points, settles at 73,799.11

KARACHI:

Pakistan Stock Exchange (PSX) on Monday surged to unprecedented highs with the addition of over 700 points and at one stage crossed the 74,000 psychological barrier over optimism surrounding the outcome of loan talks between Pakistan and the International Monetary Fund (IMF).

In the morning, the KSE-100 index endured a lacklustre start when the KSE-100 index touched the intra-day low at 73,109.76 points. Despite dropping to the day’s low very soon, the market sentiment gradually shifted towards positive cues, which lifted the index upwards.

The positive trend was powered by the government’s discussion on privatising the loss-making state-owned enterprises (SOEs) and the proposed setting of ambitious targets for the Public Sector Development Programme (PSDP) for the next fiscal year.

Additionally, planned structural reforms in the areas of taxation, energy and SOEs also contributed to the upward march.

Resultantly, the market breached the 74,000 mark and reached the intra-day high of 74,114.22 points after midday. Although some profit-taking was witnessed at that level, blue-chip stocks across various sectors, particularly exploration and production (E&P) and fertiliser, saw significant gains.

“Stocks closed at an all-time high amid speculation about the outcome of Pakistan-IMF talks for a new loan programme,” said Ahsan Mehanti, MD of Arif Habib Corp.

“Deliberations over the privatisation of SOEs, high PSDP targets in the federal budget for FY25 and structural reforms in taxation, energy sector and SOEs played the role of catalysts in record close at the PSX.”

At close, the benchmark KSE-100 index recorded a notable increase of 713.61 points, or 0.98%, and settled at 73,799.11.

Topline Securities, in its report, commented that the 74,000 barrier was breached in intra-day trading but Pakistan equities closed the day at 73,799 (up 714 points; or 0.98%).

“Positive vibes from the IMF, rejuvenated foreign interest at attractive valuations and continuous progress on the macroeconomic front could be attributed to this achievement,” it said. “Investors chose to further strengthen their positions by buying blue-chip stocks across the board.”

E&P and fertiliser sectors contributed positively where Pakistan Oilfields, Dawood Hercules Corp, Engro Corp, Pakistan Petroleum and Mari Petroleum added 307 points, Topline added.

Arif Habib Limited (AHL), in its review, wrote that E&P names started their participation, taking the KSE-100 to a new all-time high as well as above 74,000 points.

Pakistan Oilfields (+7.5%), Dawood Hercules (+3.08%) and Engro Corp (+1.45%) were the largest contributors to the index gains. The biggest drags were Fauji Fertiliser (-0.8%), Pak Elektron (-4.14%) and Pioneer Cement (-2.89%), AHL said.

JS Global analyst Mohammed Waqar Iqbal commented that the bullish trend persisted as the PSX closed at 73,799.

“The market is expected to maintain the bullish momentum. We recommend investors to buy cement, textile and pharma stocks,” the analyst added.

Overall trading volumes decreased to 721.6 million shares against Friday’s tally of 741.2 million. The value of shares traded during the day was Rs25.6 billion.

Shares of 387 companies were traded. Of these, 241 stocks closed higher, 120 dropped and 26 remained unchanged.

Cnergyico PK was the volume leader with trading in 64.2 million shares, gaining Rs0.37 to close at Rs4.74. It was followed by WorldCall Telecom with 51.6 million shares, losing Rs0.07 to close at Rs1.48 and Hum Network with 29.03 million shares, gaining Rs0.12 to close at Rs9.82.

Foreign investors were net buyers of shares worth Rs839.5 million, according to the NCCPL.

Published in The Express Tribune, May 14^th, 2024.

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