Benchmark
100-share index gains 506.59 points.
Accompanied with the inflation announcement, the bourse was also fuelled with high interest in the banking sector as trading volume remained on the high side after weeks of low turnover.
At close on Monday, the Karachi Stock Exchange (KSE) benchmark 100-share index recorded a rise of 1.53% or 506.59 points to end at 33,563.38.
Elixir Securities analyst Faisal Bilwani said equities closed the first day of the week positive as inflation reading 3.16% year-on-year for May 2015 ensured momentum from Friday sustained.
“Stocks opened positive while reports of institutional buying including foreigners’ interest in index names helped overcome anxiety related to the upcoming budget including fear of a possible gains tax rate hike,” said Bilwani.
“Banks led the surge as value hunters took advantage of the weakness after the recent discount rate cut while sentiment-driver Engro Corp (ENGRO) +5% hit the upper price limit on reported foreign buying.
“Cements also tracked gains in wider market on optimism over mega infrastructure projects while reported monthly sales data suggests a single digit decline during May 2015, said Bilwani.
“K-Electric (KEL) +5.5% led volumes and closed near three-month high at Rs8 per share on rumours of progress on sponsors exit at an attractive price.”
Topline Securities analyst said the market rallied amid lower than expected consumer price index announcement.
“Cement stocks rallied in expectation of higher development expenditure approval coupled with government’s plan to consult with the South African government to resolve the anti-dumping duties to Pakistan exporters.”
According to the analyst, the textile sector also saw renewed interest in anticipation of favorable policies in the upcoming budget.
Trade volumes decreased to 261 million shares compared to 304 million on Friday.
Shares of 367 companies were traded on Monday. Of these, 236 companies closed higher, 105 fell and 26 remained unchanged. The value of shares traded during the day was Rs11.6 billion.
KEL was the volume leader with 37.4 million shares, gaining Rs0.42 to close at Rs8.00. It was followed by TRG Pakistan Limited with 23.1 million shares, gaining Rs1.07 to close at Rs22.54 and Ghani Automobile with 16.6 million shares, losing Rs0.32 to close at Rs8.65.
Foreign institutional investors were net buyers of Rs798 million worth of shares during the session, according to data compiled by the National Clearing Company of Pakistan.
Published in The Express Tribune, June 2nd, 2015.
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