Stocks hit new peak; KSE-100 surges past 68,000

Stocks soared to a new record high for the second consecutive day on Thursday, with the benchmark KSE 100-share Index surpassing the 68,000 threshold, buoyed by a robust rally in the pharmaceutical sector, dealers said.

The Pakistan Stock Exchange's (PSX) KSE 100-share Index gained 660.75 points or 0.98 percent to close at 68,416.78 points. The highest index of the day remained at 68,439.37 points while the lowest level was recorded at 67,912.35 points. The KSE-30 index increased by 187.03 points or 0.84 percent to 22,438.45 points.

The surge was attributed to investor optimism following the Lahore High Court’s recent decision, which favored the pharmaceutical industry by lifting the stay order against the deregulation of drug prices. This led to a significant uptick in pharmaceutical stocks, many of which hit their upper price limits. Analyst Nabeel Haroon at Topline Securities said that the second consecutive positive session was observed at the exchange.

“Investor interest was observed in the pharmaceutical sector due to news that the Lahore High Court on April 2, 2024, had disposed of the case in favor of the pharmaceutical industry and the stay order against deregulation of Maximum Retail Price (MRPs) of drugs had been vacated, and multiple companies from the sector gained to close at their respective upper limit,” Haroon said.

Traded shares decreased by 27 million shares to 388.751 million shares from 361.823 million shares. The trading value rose to Rs17.882 billion from Rs11.901 billion. Market capitalization expanded to Rs9.544 trillion from Rs9.452 trillion. Of 334 companies active in the session, 204 closed in green, 108 in red and 22 remained unchanged.

Analyst Ahsan Mehanti at Arif Habib Corp said that** stocks closed at a new all-time high on a strong earnings outlook.

"Expected SBP policy easing and the $1 billion Saudi Reko Diq deal next month, along with OGDC and PPL share offerings and surging global crude oil prices, played a catalytic role in the bullish close in the earnings season."

Major positive contributions to the index came from MEBL, OGDC, DAWH, SYS, and PPL, as they cumulatively contributed 303 points to the index. PAEL declared its December result announcement in which it posted 4Q2023 EPS at Re0.44 and CY23 EPS at Rs1.55 – in line with market expectations.

Apart from the result announcement, the company informed investors that the board of directors had accorded their approval for the incorporation of a wholly-owned foreign subsidiary in the UAE, subject to all applicable regulatory approvals. The subsidiary will be primarily engaged in commercial trading with import, export, distribution, and warehousing as its ancillary activities.

The highest increase was recorded in Hoechst Pakistan Limited shares, which rose by Rs49.50 to Rs1,300 per share, followed by Shahmurad Sugar Mills Limited, which increased by Rs40.61 to Rs582.07 per share. A significant decline was noted in Rafhan Maize Products Company Limited, which fell by Rs80 to Rs8,200 per share, followed by Nestle Pakistan Limited, which closed lower by Rs33.44 to Rs7,566.89 per share.

Brokerage Arif Habib Ltd said that the market witnessed significant gains of 2 percent in the short trading week, surpassing the 68,000 points mark. "It reflected positive investor sentiment and robust market activity," the brokerage said.

As Pakistan enters into a holiday season, market participants are gearing up for a shorter trading week ahead. With Friday designated as a non-trading day, investors will have only Monday and Tuesday for active trading. This condensed schedule is anticipated to impact trading volumes and market dynamics.

In terms of year-to-date performance, Pakistan's stock market has delivered remarkable returns of 70 percent in dollar terms. This substantial growth places Pakistan well ahead of its peers, with Kazakhstan, the second-ranked market, trailing behind with returns of 43 percent.

PIAC (A) remained the volume leader with 47.200 million shares which closed higher by 97 paisas to Rs26.19 per share. Cnergyico PK followed it with 29.719 million shares, which closed higher by 34 paisas to Rs4.60 per share.

Other significant turnover stocks included Pak Petroleum, Pak Refinery, The Searle Company, PTCL, K-Electric Ltd., WorldCall Telecom, Telecard and Pak Reinsurance. In Future Market, 307 companies recorded trading, of which 183 increased, 119 decreased and 5 remained unchanged.