PSX survives pressure, ends slightly up

KARACHI:

Pakistan Stock Exchange on Thursday closed in the green despite facing mid-session pressure as investors awaited a staff-level agreement with the International Monetary Fund (IMF) following hints that all requirements had been met in the federal budget.

Earlier, trading began on a strong note, with the KSE-100 index reaching its intra-day high of 80,888.86 points. However, the momentum took a turn for the worst by midday as pressure grew over reports that the FTSE was considering reclassifying Pakistan by handing it the frontier market status as part of its September 2024 review.

This, coupled with concerns about the weakening Pakistani rupee, pulled the index down to the intra-day low of 80,134.89 points at midday.

Despite the setback, the market rebounded on speculation of robust payouts by state-owned enterprises (SOEs) and government’s deliberations on privatisation of state units.

Key sectors contributing to the market’s performance were cement, banking, food and exploration and production (E&P). Ultimately, the bourse closed at a record high above the 80,200 mark but with marginal gains.

“Stocks closed higher as investors weighed the IMF’s staff-level agreement in the coming weeks after the Ministry of Finance hinted at addressing all the requirements for the bailout,” said Ahsan Mehanti, MD of Arif Habib Corporation.

Mid-session pressure emerged on reports of FTSE reclassifying Pakistan to give it the frontier market status in conjunction with the FTSE Global Equity Index Series and the FTSE Frontier Index Series reviews in September 2024 amid the weakening rupee, he said.

“Speculation about strong corporate payouts by the SOEs and deliberations over privatisation played the role of catalysts for the new record close at the PSX.”

At the end of trading, the benchmark KSE-100 index recorded a slight increase of 49.13 points, or 0.06%, and settled at 80,282.80.

Topline Securities, in its report, said Pakistan’s equity market experienced a mixed day on Thursday.

Key contributors to the market’s performance were the cement, banking, food and exploration sectors, led by Lucky Cement, Faysal Bank, Meezan Bank, National Foods and Pakistan Oilfields, which collectively added 147 points to the index, it added.

Arif Habib Limited (AHL), in its report, noted that support continued to build around the 80,000 level, “which is structurally bullish”.

Lucky Cement (+1.42%), Faysal Bank (+5.11%) and Meezan Bank (+0.85%) were the biggest contributors to the index gains while Hub Power (-0.89%), Pakistan Petroleum (-1.17%) and Oil and Gas Development Company (-1.08%) were the largest drags, it said.

“Pakistan has been reclassified to the FM status from the secondary emerging market by the FTSE Russell as it had been on the watch list since last year,” AHL added.

JS Global analyst Mubashir Anis Naviwala wrote the market managed to continue its bullish momentum with the index touching the intra-day high of 80,888 points within half an hour.

“Moving forward, we advise investors to book profits at higher levels while any dips can be considered as an opportunity to buy cement, steel, oil and gas, and tech stocks,” the analyst added.

Overall trading volumes decreased to 496.8 million shares compared with Wednesday’s tally of 536.6 million. The value of shares traded during the day stood at Rs19.3 billion.

Shares of 446 companies were traded. Of these, 188 stocks closed higher, 194 fell and 64 remained unchanged.

The Bank of Punjab was the volume leader with trading in 29.3 million shares, gaining Rs0.13 to close at Rs5.53. It was followed by PIA Holding Company with 26.7 million shares, gaining Rs1.52 to close at Rs18.46 and Pak Elektron with 26.5 million shares, losing Rs0.23 to close at Rs26.52.

Foreign investors were buyers of shares worth Rs606.8 million, according to the NCCPL.