The strong surge of bullish sentiment continued unabated in the opening trading session of the second week post elections, with investors pouring money into the stock market over hopes that the incoming government will save the ravaged economy.
The Karachi Stock Exchange’s (KSE) benchmark 100-share index surged 1.35% or 277.11 points to end at the 20,814.14 points level. Trade volumes remained high at 344 million shares, but were lower as compared with Friday’s tally of 372 million shares. The value of shares traded during the day was Rs10.87 billion.
“Speculations for an early resolution of the circular debt crisis, which is a priority for the new government, rising local cement and urea prices, and foreign interest in oil and energy stocks played the role of a catalyst in the bullish post-election rally at the KSE,” commented Ahsan Mehanti from Arif Habib Corp.
“The market closed at a new high […] led by foreign buying in large cap stocks,” reported Samar Iqbal, Topline Securities’ senior manager equity sales.
Shares of 391 companies were traded on Monday. At the end of the day, 206 stocks closed higher, 145 declined, while 40 remained unchanged.
“Index heavyweights Oil and Gas Development Company (up 5%) and Pakistan State Oil (up 5%) led the rally, hitting their upper price limit [and] pulling Pakistan Petroleum (up 4.3%) along,” reported Harris Ahmed Batla, analyst at Elixir Securities. “Index drive [sic] fetched retail interest in second and third-tier cement stocks in the likes of Maple Leaf Cement, Lafarge Cement and Fauji Cement.”
Lafarge Pakistan was the volume leader with 37.72 million shares, gaining Rs0.89 to finish at Rs7.97. It was followed by Maple Leaf Cement with 24.82 million shares, gaining Rs0.75 to close at Rs21.10; and Fauji Cement with 21.02 million shares, gaining Rs0.33 to close at Rs11.06.
The government’s focus on overcoming the energy crisis prevented the fertiliser sector from contributing to the rally due to a threat of gas cuts, Batla said, while financials also witnessed profit-taking on higher levels.
Foreign institutional investors were net buyers of Rs1.17 billion worth of securities, according to data maintained by the National Clearing Company of Pakistan Limited.
Published in The Express Tribune, May 21st, 2013.
Like Business on Facebook to stay informed and join in the conversation.
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ