Stocks hit record high amid privatisation buzz

Exploration, pharma companies take KSE-100 index to 93,648 points

KARACHI:

Pakistan Stock Exchange (PSX) rallied to a new all-time high at 93,648 points, driven by blue-chip stocks, as investor optimism grew over news of impending privatisation of state-owned enterprises (SOEs) and foreign interest triggered by the revised MSCI index weight for Pakistan.

A stable rupee and declining bank lending rates, following a drop in government bond yields, further spurred buying activity.

"Stocks reached a new all-time high, led by blue chips, on the IMF's calls for privatisation of SOEs and expected foreign interest after revision in the MSCI standard index weight to 4.4%," said Ahsan Mehanti, Managing Director of Arif Habib Corp.

Rupee stability and the falling bank lending rates following a slump in government's bond yields played the role of catalysts in bullish activity at the PSX, he added.

At the close of trading, the benchmark KSE-100 index recorded an increase of 356.64 points, or 0.38%, to 93,648.33.

Topline Securities wrote in its review that the market showed a positive momentum, with the KSE-100 index reaching the peak of 94,020 and dipping to the low of 93,319, as investors took a directional stance, driven by lower valuations in the pharmaceutical sector.

The index was lifted by positive contributions from Oil and Gas Development Company (OGDC), Pakistan Petroleum Limited (PPL), Abbott Laboratories, The Searle Company and GlaxoSmithKline, which collectively added 399 points.

Trading activity remained robust, with 815 million shares traded, amounting to Rs37 billion, Topline added.

AHL, in its report, said it was a strong session for the exploration and production (E&P) sector and Sui companies, with the KSE-100 index gaining 0.4% day-on-day.

Fifty-one shares rose, while 46 declined, where OGDC (+3.25%), PPL (+2.73%) and Abbott Laboratories (+9.74%) emerged as the top contributors to the index gains. Pharmaceutical stocks were also in demand, with most names reaching their daily price limit, it said.

Notable movements were seen in Sui Southern Gas Company (+10%) and Pak Elektron (+8%), which recorded an all-time high trading volume of 78 million shares.

Attock Refinery (-4.04%) issued a notice to the PSX, denying recent market rumours of a potential sale of the company. The refinery had been trading up 9.5% day-on-day before the clarification.

The momentum remained robust, with clear sector rotation in the market and near-term support around the 92,000 level, AHL added.

JS Global analyst Mubashir Anis Naviwala wrote that the PSX saw a volatile session, hitting a record intra-day high of 94,020 points before profit-taking set in, pulling the market back to 93,319.

Despite this, strong interest in E&P and pharma stocks kept investor sentiment high. The KSE-100 index ultimately settled at 93,648, marking a gain of 357 points.

"Moving forward, we recommend a buy-on-dips strategy, with a focus on E&P, pharmaceutical and fertiliser sectors, which are poised for a potential upside," the analyst said.

Overall trading volumes increased to 815.2 million shares compared with Friday's tally of 763.3 million. The value of shares traded during the day was Rs37.3 billion.

Shares of 454 companies were traded. Of these, 227 stocks closed higher, 184 fell and 43 remained unchanged.

Cnergyico PK was the volume leader with trading in 98.6 million shares, gaining Rs0.4 to close at Rs4.52. It was followed by Pak Elektron with 78.1 million shares, gaining Rs2.15 to close at Rs29.01 and K-Electric with 70.2 million shares, gaining Rs0.14 to close at Rs4.98.

During the day, foreign investors sold shares worth Rs18.2 million, according to the NCCPL.