PSX recovers, takes cue from global trends

KARACHI:

Pakistan Stock Exchange (PSX) recovered slightly in Tuesday’s trading session, marked by gains in second and third-tier shares, primarily due to a rebound in global equities and strong corporate earnings.

Earlier, the trading day began on a promising note, with the KSE-100 index reaching its intra-day high of 77,746.55 points. However, the initial surge proved short-lived as investors resorted to widespread profit-taking, resulting in the index swiftly dropping to the intra-day low of 77,035.95 points around midday.

Despite the dip, investor efforts to lift the index gained pace later in the day. A new hydrocarbon discovery made by Pakistan Oilfields Limited (POL) at TAL block and the surge in global crude oil prices provided critical support to the market’s upward movement.

Consequently, the bourse managed to wipe out earlier losses and ended the day above the 77,000 mark with thin gains of over 100 points.

“Stocks closed higher, led by second and third-tier shares, amid recovery in global equities and strong corporate earnings,” stated Ahsan Mehanti, MD of Arif Habib Corp.

“POL’s discovery at TAL block and the surge in global crude oil prices also played the role of catalysts in positive close at the PSX.”

At the end of trading, the benchmark KSE-100 index registered gains of 106.85 points, or 0.14%, and settled at 77,191.34.

Topline Securities, in its report, commented, “Pakistan equities experienced recovery in Tuesday’s trading session, mirroring the trends in international markets. However, the resurgence was short-lived.”

“Hub Power gained ground on the back of news that Chinese automotive giant BYD is set to make its official entry into the Pakistani market with a grand brand launch scheduled for August 17,” it said.

Systems Limited, Hub Power, Pakistan Services, Habib Metropolitan Bank and Habib Bank mainly contributed positively as they collectively added 242 points to the index. Conversely, Bank AL Habib, Lucky Cement and Pakistan State Oil had a negative impact, erasing 159 points, Topline added.

Arif Habib Limited (AHL), in its report, remarked that as Asian equities rebounded, Pakistan did not participate significantly and closed almost “flat”.

Some 45 shares rose while 48 fell with Hub Power (+0.93%), Meezan Bank (+1.12%) and Systems Limited (+1.6%) being the biggest contributors to the index gains, AHL said, adding that Lucky Cement (-1.64%), Pakistan State Oil (-1.76%) and Bank Alfalah (-0.79%) were the major drags. JS Global analyst Mohammed Waqar Iqbal said that attractive levels and a recovery in global capital markets brought bulls back to the PSX trading floor on Tuesday.

Buying was mostly seen in auto and tech stocks. However, profit-taking followed at higher valuations due to global political tensions, he said. “Moving forward, investors are advised to adopt a cautious stance, considering the positions in auto, tech, refinery, oil and gas sectors during dips,” the analyst added.

Overall trading volumes increased to 600.9 million shares compared with Monday’s tally of 501.2 million. The value of shares traded during the day was Rs17.1 billion.

Shares of 443 companies were traded. Of these, 206 stocks closed higher, 176 fell and 61 remained unchanged.

Kohinoor Spinning Mills was the volume leader with trading in 147.5 million shares, gaining Rs0.69 to close at Rs6.10. It was followed by Yousuf Weaving Mills with 53.7 million shares, gaining Rs0.02 to close at Rs4.16 and Hascol Petroleum with 41.4 million shares, gaining Rs0.28 to close at Rs6.56.

Foreign investors were net buyers of shares worth Rs386.7 million, according to the NCCPL.