PSX at peak ahead of policy decision

KSE-100 index gains 877 points, driven primarily by interest in energy stocks

KARACHI:

The Pakistan Stock Exchange (PSX) opened the week on Monday with renewed optimism and rose to a record high above 170k, reflecting the extension of bullish momentum from the previous week. Investors remained somewhat upbeat ahead of the monetary policy announcement later in the day, when the central bank unexpectedly cut its policy rate by 50 basis points.

The rally was largely driven by buying interest in energy stocks, alongside expectations of a reduction in the policy rate. The session saw wild swings as the KSE-100 index traded between the intra-day high of 171,002 and the low of 170,293, indicating active participation.

At close, the benchmark index recorded a notable growth of 876.82 points, or 0.52%, and settled at 170,741.35.

In its market wrap, KTrade Securities wrote that the PSX kicked off the week on a strong footing, extending the positive momentum seen in recent sessions. The KSE-100 index gained 877 points to close at 170,741, marking a new all-time high, as sustained buying interest kept the market firm throughout the day.

Sector-wise performance was led by oil & gas, technology and cement stocks. Pakistan Petroleum emerged as the largest contributor to the index's advance, while Systems Limited, Maple Leaf Cement, National Bank, United Bank and Oil and Gas Development Company (OGDC) also made notable positive contributions, it said.

Market activity was healthy as the outlook remained constructive, supported by several positive developments, including the 50-basis-point rate cut to 10.50%, partial progress on settling energy-sector circular debt and renewed US investment commitment to the Reko Diq mining project, KTrade observed.

Arif Habib Ltd (AHL) Deputy Head of Trading Ali Najib remarked that after multiple unsuccessful attempts, the PSX finally managed to close above the key 170k level, with the KSE-100 index ending the session at 170,741, up 877 points.

He pointed out that trading opened on a strong note, driven by optimism surrounding the resolution of gas-sector circular debt. This development kept energy stocks, particularly Pakistan Petroleum, Sui Southern Gas Company (SSGC), Sui Northern Gas Pipelines Ltd, Mari Energies and OGDC, in the spotlight as they enjoyed strong buying interest during the early hours.

At one point, the benchmark index even crossed the 171k mark; however, profit-taking at higher levels trimmed some of the gains, Najib said. In a major move, the State Bank surprised markets by cutting the policy rate by 50 basis points to 10.5%, contrary to a Bloomberg survey where 40 out of 42 economists expected the rate to stay unchanged.

Pakistan Petroleum, Systems Ltd, Maple Leaf Cement, NBP and UBL collectively added 652 points to the index, while Hub Power, Fauji Fertiliser, Engro Fertilisers, Bank AL Habib and SSGC faced profit-taking, erasing 156 points, he added.

JS Global analyst Mubashir Anis Naviwala noted that stocks extended their bullish momentum as the KSE-100 closed at 170,741, up 877 points. The index traded volatile but stayed firm above the 170k psychological mark.

He mentioned that the intra-day range remained wide, showing active participation on both sides. Buying interest re-emerged after midday consolidation, and a late-session surge helped the index close near the day's highs. "Market outlook remains positive while holding above the support level of 170k," he said.

Overall trading volumes increased to 905.7 million shares compared to the previous tally of 873 million. The value of traded shares stood at Rs47.7 billion.

Shares of 486 companies were traded. Of these, 239 closed higher, 202 dropped, and 45 remained unchanged.

Pakistan International Bulk Terminal topped the volumes with trading in 123.3 million shares, gaining Rs1.56 to close at Rs17.19. It was followed by Hum Network with 39.7 million shares, rising Rs0.23 to close at Rs15.11 and Fast Cables with 36.3 million shares, higher by Rs1.77 to close at Rs26.24.

During the day, foreign investors bought shares worth a net Rs46.2 million, the National Clearing Company of Pakistan reported.