The capital market on Wednesday surged sharply where activity mostly centred on cement, oil marketing companies and power sector stocks on the back of positive developments, which encouraged investors to place sizeable deals, dealers said.
The benchmark KSE-100 shares index at one stage crossed the 47,000 barrier, and hit session high of 47,123 points. This barrier was crossed almost after 3.5 years. The last time it was broken in August 2017. However, selling in some blue chips and investment stocks clipped the gains, forcing the index to close below 47,000 points level.
Pakistan Stock Exchange (PSX) KSE-100 index gained 0.76 percent or 353.29 points to close at 46,933.63 points. Volumes increased 616.309 million shares, from 468.062 million shares on Tuesday. KSE-30 shares index rose 0.88 percent or 170.19 points to end at 19,568.76 points level.
Salman Ahmad, head of institutional sales at Aba Ali Habib, said, “Market scored appreciable gains under the lead of cement, power and OMCs’ sectors.”
Cement and OMCs encouraged buying on their sales number as in January, cement sales climbed up 16 percent, while petroleum products were up 12 percent. Another factor that built the recent rally was the nearing of circular debt resolution for independent power projects, including Kot Addu and Hubco, whereby bonds and some cash would be released to settle the issue, Ahmad added.
Arab light closed at $58/bbl, up 1.5 percent DoD.
Muhammad Abdur Rafay, research analyst at Pearl Securities, said, “The benchmark index sustained bullish momentum on account of global stock rallies.”
He also attributed circular debt resolution talks as a trigger for the positive movements in the market. Cement stocks also benefitted from the announcement of Rs378 billion allocations for low-cost housing scheme by the banks.
The market would likely remain volatile; “therefore, we repeat our stance for investors to remain sellers at higher level,” Rafay added.
Of 438 active scrips, 236 increased, 184 lost, and 18 remained unchanged.
Umair Naseer, from BMA Equity Desk, said the major drivers were E&Ps and cements on the back of higher oil prices and improving cement sales and prices.
“The market sentiment is mainly driven by strong liquidity (institutions and retail investors), low interest rates and improving sector sales, which “we expect to continue going forward,” Naseer added.
Stocks including Mari Petroleum, Lucky Cement, Chirat Cement Company, and Pakistan Oilfields Limited added 160 points to the index.
Analyst Ahsan Mehanti from Arif Habib Corporation also attributed the positive index to the bull run in global equities and crude oil prices.
Stronger rupee, upbeat data of 16.28 percent YoY surge in cement sales, exports up 5.5 percent YoY for January 2021, and $400 million record receipts in Roshan Digital Accounts played a catalytic role in bullish close, Mehanti added.
Mari Petroleum, up Rs98.91 to close at Rs1,533.98/share, and Indus Dyeing, strengthening by Rs45.89 to finish at Rs657.88/share, were the major gainers.
AKD Capital, down Rs45.56 to close at Rs561.98/share, and Island Textile, losing Rs44.94 to close at Rs1,800/share, were the main losers.
K-Electric Limited led volumes with 59,324 million shares. The scrip gained Re0.18 to end at Rs12.69/share.
Unity Foods Limited posted the lowest turnover with 14,238 million shares, it lost Re0.44 to end at Rs35.66/share.