Despite enduring a lacklustre session, the Pakistan Stock Exchange (PSX) closed higher on Tuesday, driven by speculation ahead of the announcement of federal budget for 2024-25 in the first week of June.
The KSE-100 index dipped to the intra-day low of 74,958.09 points in the morning in the absence of major positive triggers. Later, it gradually climbed up along with minor fluctuations.
The upward march was fueled by a robust corporate earnings outlook and an upbeat World Bank forecast that put inflation at a lower level in Pakistan at 15% for FY25.
Additionally, the current account deficit at just 0.6% of gross domestic product (GDP), rupee stability and foreign investment inflows also aided the market’s growth.
As a result, the index crossed the crucial 75,000 mark, reaching its intra-day high of 75,482.46 points. It closed above the 75,000 mark with modest gains.
“Stocks closed higher on speculation ahead of the federal budget for FY25 due on June 7,” said Ahsan Mehanti, MD of Arif Habib Corp.
“Strong earnings outlook, upbeat World Bank forecast of 15% inflation for FY25, current account deficit at 0.6% of GDP, rupee stability and foreign inflows played the role of catalysts in higher close at the PSX.”
At the end of trading, the benchmark KSE-100 index recorded an increase of 122.77 points, or 0.16%, and settled at 75,206.77.
Topline Securities, in its report, commented that the KSE-100 index experienced a mixed session, reaching the intra-day high of 398 points and intra-day low of 125 points. It closed at 75,207, up 0.16%.
“The federal government is set to present the budget for the upcoming fiscal year on June 7, 2024 in the National Assembly,” it said.
Positive contribution to the index came from Meezan Bank, Bank AL Habib, United Bank, Service Industries and Pakgen Power, which added a total of 301 points.
On the flip side, Dawood Hercules Corp, Pakistan Oilfields, Fauji Fertiliser, Thal Limited and Oil and Gas Development Co erased 180 points from the index, Topline added.
Arif Habib Limited (AHL), in its review, said “KSE-100 continues to hold the 75,000 level as does the KSE-30 with 24,000, above which the two benchmarks have a positive short-term outlook.”
Meezan Bank (+4.19%), Bank Alfalah (+2.09%) and United Bank (+1.53%) were the biggest contributors to the index gains, it said, adding that Dawood Hercules (-3.9%), Pakistan Oilfields (-2.08%) and Fauji Fertiliser (-1.02%) were the largest drags.
“PSX will gradually enhance the security-wise circuit breakers by 0.5% on a fortnightly basis until they reach 10% from the current 7.5%,” AHL added.
JS Global analyst Mohammed Waqar Iqbal said the KSE-100 index closed with a gain of 123 points at 75,207. “Going forward, the market is anticipated to maintain the upward momentum,” the analyst added.
Overall trading volumes increased to 462.3 million shares against Monday’s tally of 375.4 million. The value of shares traded during the day was Rs15.9 billion.
Shares of 381 companies were traded. Of these, 174 stocks closed higher, 184 dropped and 23 remained unchanged.
K-Electric was the volume leader with trading in 40.9 million shares, gaining Rs0.17 to close at Rs4.84. It was followed by Dewan Cement with 38.5 million shares, gaining Rs0.92 to close at Rs10.80 and Symmetry Group with 32.85 million shares, gaining Rs1 to close at Rs4.94.
Foreign investors were net sellers of shares worth Rs4.34 billion, according to the NCCPL.
Published in The Express Tribune, May 22nd, 2024.
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