Stocks aimed for sky on Monday as government managed to defuse a brewing political storm by convincing Tehreek-e-Labbaik Pakistan (TLP) to call off their raging protests, amid yet another reassurance on the continuity of the IMF programme, traders said.
The KSE-100 Shares Index, the key gauge of the country’s main capital market, Pakistan Stock Exchange (PSX), shot up by 790.07 points or 1.71 percent to close at 46,974.78 points. The index tested a high of 47,257.13 and a low of 46,184.71 points during the session.
Arif Habib Ltd, a brokerage house, in its market wrap said bullish momentum was witnessed in the first half of the session as the index made an intraday high of 1,059 points due to appreciation of rupee, downturn of the commodities price cycle, and ease of political noise.
Cyclicals (cement and steel) sectors contributed the most in the bull-run, it reported. After making an intra-day high, investors opted for profit-booking after the announcement of Consumer Price Index (CPI) for the month of October 2021 clocked in at 9.19 percent YoY (+1.9 percent MoM) against market expectation of 8.5 percent, the brokerage said.
It further added that expectations of interest rate hike by the central bank in the upcoming monetary policy caused profit-booking in cyclical stocks and accumulation in banking stocks.
KSE-30 Shares Index also surged 321.46 points or 1.79 percent to end at 18,254.87 points. Ready market voulume increased 160 million shares to 430.08 million shares from 270.40 million shares on the last trading day. The traded value increased to Rs14.77 billion from Rs9.73 billion. Market capital rose to Rs8.063 trillion from Rs7.953 trillion.
Out of 372 active names, 271 posted gains, 87 losses, while 14 remained unchanged. Topline Securities in a post-market note said sentiments turned positive as the government on Sunday said it had reached an agreement with TLP to end a 10-day standoff with the latter.
Sentiments were further buoyed after Prime Minister Imran Khan rejected the Oil and Gas Regulatory Authority (OGRA) and Finance Ministry’s proposals to increase the prices of petroleum products for the month of November.
Allawasaya Textile was the top gainer as it rose by Rs129.57 to Rs2,299.99/share, followed by Nestle Pakistan, up Rs100 to close at Rs5,900/share. Philip Morris Pakistan was the worst loser as it fell Rs65.45 to Rs830/share, followed by Sapphire Textile, down Rs91.30 to close at Rs1,128.70/share.
Analyst Ahsan Mehanti at Arif Habib Corp said, bullish activity a result of easing political concerns and the apex bourse’s resolve to fix the trading systems issues.
Strong rupee recovery, surging global equities, and expected announcement on resumption of IMF programme were the main triggers, Mehanti said. Sectors contributing to the performance included cements (+151 points), fertilisers (+97 points), E&P (+79 points), technology (+75 points), and banks (+29 points).
WorldCall Telecom led volumes as it registered a trade of 53.86 million shares, followed by Byco Petroleum with 24.50 million shares. Stocks that recorded significant turnover included Hum Network, Maple Leaf, Telecard LimitedXB, Fauji Cement, Unity Foods Ltd, Merit Pack (R), Azgard Nine, and TRG Pakistan Ltd. Turnover in the future contracts decreased to 135.87 million shares from 220.83 million shares on the last trading day.