Bulls propel PSX higher over strong earnings

KARACHI:

Bulls kept a firm grip over the Pakistan Stock Exchange (PSX) on Friday as they propelled the KSE-100 index higher by nearly 700 points, taking cue from strong corporate earnings and positive global markets.

The momentum was powered by investor interest in stocks of cement, banking and oil sectors, which got support from an improved earnings outlook. The positive trend was reinforced by the rise in global equities and increase in Pakistan's foreign exchange reserves.

At the opening bell, trading commenced on a positive note, reflecting the previous day's rally. The bourse saw strong buying across varying sectors such as cement, commercial banks and oil marketing companies.

Among financial results, Lucky Cement reported a 24% year-on-year (YoY) hike in consolidated earnings to Rs14.6 billion for the fourth quarter, though the results fell short of expectations due to a 44% drop in other income to Rs2.03 billion.

"Stocks closed on a bullish note, driven by gains in cement, banking and oil sectors and supported by a strong outlook of corporate earnings," stated Ahsan Mehanti, MD of Arif Habib Corp.

"Bullish sentiment in global equities, surging foreign exchange reserves, lower inter-bank rates and imminent approval of the IMF Extended Fund Facility (EFF) acted as catalysts for bullish close at the PSX."

At the end of trading, the benchmark KSE-100 index recorded impressive gains of 695.36 points, or 0.89%, and settled at 78,569.59.

Topline Securities, in its report, noted that the stock market largely traded in positive zone as the index gained 695 points and closed at 78,570.

Major positive contribution to the index came from Mari Petroleum, United Bank, MCB Bank, Systems Limited and Meezan Bank as they added 566 points, Topline said.

Arif Habib Limited (AHL), in its report, highlighted that the KSE-100 index closed the week on a solid note above 78,000 with a 0.42% rise week-on-week.

Some 69 shares rose while 29 fell on Friday with Mari Petroleum (+10%), United Bank (+3.36%) and Meezan Bank (+1.45%) being the biggest contributors to the index gains.

In a move to tackle soaring energy costs, the government has planned to review and potentially terminate agreements with 15 independent power producers (IPPs), it said. During the day, Kot Addu Power Company's stock fell 3.48%.

Fauji Fertiliser Bin Qasim announced that it would sell 166.38 acres of land at Pindi Bhattian to the Fauji Foundation for Rs856 million, or Rs5.15 million per acre. "Our analysis indicates that this land sale will impact the cash flow positively by Rs0.66 per share and result in gains of Rs0.28 per share," AHL added.

JS Global analyst Mohammed Waqar Iqbal stated that bulls dominated at the trading floor due to buying interest mainly in tech, banking and oil sectors. The index went as high as 78,823 points (+949 points) during the day.

Mari Petroleum, United Bank, Meezan Bank, MCB Bank and Systems Limited were the main contributors to the index, he said.

Overall trading volumes decreased to 420.4 million shares compared with Thursday's tally of 493.1 million. The value of shares traded during the day was Rs20.7 billion.

Shares of 446 companies were traded. Of these, 226 stocks closed higher, 156 fell and 64 remained unchanged.

Kohinoor Spinning Mills was the volume leader with trading in 64.8 million shares, gaining Rs0.82 to close at Rs6.64. It was followed by Yousuf Weaving Mills with 24.9 million shares, gaining Rs0.64 to close at Rs4.34 and The Organic Meat Company with 18.1 million shares, gaining Rs1.93 to close at Rs46.29.

Foreign investors were net buyers of shares worth Rs6.5 million, according to the NCCPL.