Stocks bolted higher on Monday on reports the government has won over their estranged allies, mustering much-needed support against no-trust vote, avoiding any political shocks for the economy for now, traders said.
Pakistan Stock Exchange's (PSX) benchmark KSE-100 Share Index closed higher by 382.41 points or 0.88 percent to 43,933.56 points against 43,551.15 points recorded in the last session.
The highest index of the day remained at 43,933.56 points while the lowest level of the day was recorded at 43,291.03 points. Zafar Moti, a former director of PSX, said the market was slow in the morning with low volumes and it also lacked a direction.
Following reports that PTI government was ready to sacrifice Usman Buzdar, chief minister Punjab, to ease the political pressures it was under, investors picked and chose select stocks and this momentum was expected to continue, he said.
“They shouldn’t celebrate too early as it’s not over yet; however, the government’s fence-mending gesture went down well with the market,” Moti said. Prime Minister Imran Khan on Monday nominated PML-Q leader Pervez Elahi as the next chief minister of Punjab. Buzdar, it was reported, has handed over his resignation to the premier. This followed the successful negotiations between Khan and Elahi.
A government spokesperson said that matters between the ruling PTI and its key ally PML-Q had been settled. He maintained that the PML-Q’s leadership expressed KSE-30 Shares index also jumped 136 points or 0.82 percent to 16,793.48 points compared with 16,657.48 points recorded in the last session.
Traded shares, however, decreased 29 million to 132.63 million from 161.93 million shares, while value rose to Rs4.802 billion from Rs4.146 billion.
Turnover in the futures contracts decreased to 41.50 million from 263.41 million shares. Market capital expanded to Rs7.417 trillion from Rs7.358 trillion. Out of 328 companies active in the session, 216 posted gains, 87 losses, while 25 remained unchanged.
Analyst Ahsan Mehanti at Arif Habib Corp said stocks closed higher amid thin trade and speculations ahead of National Assembly session to decide on no-confidence vote against Prime Minister.
Institutional support on a likely accord with IMF this week after 7th review under EFF, a slump in global crude oil prices, and easing economic uncertainty led to a bullish close, Mehanti said. The highest increase was recorded in the shares of Rafhan Maize, which rose by Rs357 to Rs11,990 per share, followed by Premium Textile, which climbed Rs46.43 to Rs666/share. A major decline was noted in shares of Sapphire Textile, which fell Rs77.68 to Rs961.27/share, followed by Colgate Palmolive that slipped Rs70 to Rs2,220/share.
Mubashir Anis Naviwala, an analyst at JS Research, said after a week of range-bound sessions, bulls made a comeback with an interest in cement and technology sector stocks. “Going forward, we might see another spell of dullness and recommend investors to avail any downside as an opportunity to buy in the cement, technology and energy sectors,” Naviwala said.
Telecard Limited led the volumes chart with 13.11 million shares, followed by WorldCall Telecom that registered turnover of 6.66 million. Stocks that recorded significant turnover included K-Electric Ltd., Ghani Global Holding, TRG Pak Ltd, Dolmen City, Pak Elektron (R), TPL Properties, Fauji Foods Ltd XD, and Cnergyico PK.