Stocks celebrate 2024 with massive gains, IMF tranche nears

Stocks surged more than 3.5 percent on Monday, the first trading day of 2024, as investors cheered the economic stability and the prospects of receiving an IMF tranche this month, dealers said.

The Pakistan Stock Exchange's (PSX) benchmark KSE 100-share Index gained 2,210.74 points or 3.54 percent to close at 64,661.78 points. The highest index of the day remained at 64,718.88 points while the lowest level was recorded at 62,672.97 points.

The KSE-30 index also increased by 839.59 points or 4.04 percent to close at 21,616.13 points.

Ahsan Mehanti, an analyst at Arif Habib Corp, said the imminent release of the IMF tranche this month, surging foreign currency reserves , the government resolve to end circular debt crises, current account surplus in Nov’23 played a catalytic role in the bullish close.

Traded shares increased by 35 million shares to 625.147 million shares from 590.592 million shares. The trading value increased to Rs18.525 billion from Rs16.844 billion. Market capital expanded to Rs9.343 trillion against Rs9.062 trillion. Out of 380 companies active in the session, 328 closed in green, 37 in red and 15 remained unchanged.

Analyst Ali Najib at Topline Securities said equities commenced the new year with a bang where the benchmark index rallied over three percent.

"The day initiated on a strong note on the backdrop of news regarding the release of funds to the Independent Power Producers which helped energy stocks to remain in the limelight since throughout the as OGDC, PPL, PSO, SNGP and SSGC all hit their limits up for the day," Najib said.

"In addition, banking sector stocks also joined the party as investors did some cherry-picking in them in anticipation of better-than-expected earnings with

good dividends in the upcoming result seasons about to start in the next couple of weeks."

Resultantly, PPL, OGDC, SYS, HUBC and UBL positively contributed 692 points to the index.

The highest increase was recorded in Unilever Pakistan Foods Limited, which rose by Rs300 to Rs22,200 per share, followed by Hoechst Pakistan Limited, which increased by Rs88.47 to Rs1,288.47 per share.

A significant decline was noted in Blessed Textiles Limited, which fell by Rs19.99 to Rs320.01 per share, followed by Bata Pakistan Limited, which closed lower by Rs10.08 to Rs1,722.15 per share.

Brokerage Arif Habib Ltd said closing the year on a commendable note, Pakistan secures the 22nd position on the Bloomberg index, boasting a substantial gain of +24.54 percent (USD).

"As the new year unfolds, seasonal tendencies are poised to maintain a bullish trajectory, extending into February," the brokerage said. "This positive momentum aligns with expectations of reaching a new all-time high."

It added that crucially, support levels have risen to 63,000 points, underpinning the market's stability. "The strategic target now stands at 67,000 points level, reflecting a forward-looking perspective for Pakistan's financial landscape."

"This statement captures the resilience and upward potential of Pakistan's market, setting a promising tone for the upcoming period."

K-Electric Ltd. remained the volume leader with 76.430 million shares which closed higher by 18 paisas to Rs5.44 per share.

WorldCall Telecom followed it with 61.550 million shares, which closed higher by 16 paisas to Rs1.57 per share.

Other significant turnover stocks included Cnergyico PK, B.O. Punjab, Fauji Foods Ltd, Pak Refinery, P.T.C.L., Pak Elektron, Hascol Petrol and Air Link Commun.

A total of 312 companies recorded future shares, of which 304 increased, 7 decreased and 1 remained unchanged.