Economic optimism pushes KSE-100 to first close above the 73,000 milestone

KARACHI: Stocks rose to a record finish on Friday, with the benchmark KSE 100-share Index closing above the 73,000 mark for the first time, as investors cheered robust remittance data and a decline in inflation figures, dealers said.

The Pakistan Stock Exchange's (PSX) benchmark index gained 427.45 points or 0.59 percent to close at 73,085.50 points. The KSE-30 index increased by 44.51 points or 0.19 percent to 23,427.19 points from 23,382.68 points.

“Stocks closed at an all-time high in the pre-budget rally at the PSX after robust data on $2.81 billion remittances surged by 28 percent year-on-year in April," said analyst Ahsan Mehanti at Arif Habib Corp.

"The cement sector outperformed due to the government target of a 27 percent hike in PSDP to Rs1.2 trillion for FY25, rupee stability due to surging forex reserves to $9.12 billion and speculations ahead of Pakistan-IMF new loan talks this month played a catalytic role in the record close."

Traded shares increased by 67 million shares to 741.196 million shares from 674.981 million shares. The trading value rose to Rs25.268 billion from Rs24.053 billion. Market capitalization expanded to Rs9.878 trillion from Rs9.821 trillion. Of the 381 companies active in the session, 217 closed in the green, 132 in the red and 32 remained unchanged.

Nabeel Haroon, an analyst at Topline Securities, said a range-bound activity was observed during the early hours of trade; however, as the day progressed, a rally was observed in the market where the index gained to make an intraday high of 791 points.

“This positivity in the market can be attributed to the weekly SPI number which posted a decline for the 4th consecutive week (down by 1.39 percent week-on-week) for the week ending May 09, 2024,” he added.

Cement and steel sectors remained in the limelight as they gained to close higher than Thursday’s closing.Interest in the aforementioned sector was due to the weekly SPI number which boosted investors' confidence with respect to the decline in the policy rate going forward.

Major positive contributions to the index came from LUCK, DGKC, PIOC, POL, and ILP, as they cumulatively contributed 218 points.The highest increase was recorded in Hoechst Pakistan Limited shares, which rose by Rs94.71 to Rs1,444.71 per share, followed by Bhanero Textile Mills Limited, which increased by Rs74.75 to Rs1,071.36 per share. A significant decline was noted in Unilever Pakistan Foods Limited, which fell by Rs99.98 to Rs19,090 per share, followed by Hallmark Company Limited, which closed lower by Rs58.18 to Rs717.54 per share.

Muhammad Rizwan, an analyst at Chase Securities, said the PSX soared to a record high, with the market value surging by 32 billion compared to the previous 30.7 billion.Investor optimism over anticipated lower CPI figures for the month fuelled speculation of an interest rate cut in the forthcoming June monetary policy. This sentiment propelled the cement sector to the forefront, contributing a significant 213 points to an overall market gain of 427 points.

After a prolonged period of dormancy, the textile composite sector finally garnered attention, witnessing notable upticks. NML surged by 6 percent, ILP gained 4.5 percent, NCL hit its upper cap at 7.5 percent, and GATM also registered a commendable increase of 6.35 percent. Positive momentum engulfed pharmaceutical companies, fueled by ongoing discussions surrounding the potential deregulation of over-the-counter medicines.

WorldCall Telecom remained the volume leader with 85.720 million shares which closed higher by 4 paisas to Rs1.55 per share. Hum Network followed with 51.463 million shares, which closed lower by 33 paisas to Rs9.70 per share.

Other significant turnover stocks included Pak Elektron, Fauji Cement, Hascol Petrol, K-Electric Ltd., Kohinoor Spinning, Pak Int. Bulk, D.G.K. Cement, and Maple Leaf.In the Future Market, 318 companies were recorded trading, of which 185 increased, 132 decreased and one remained unchanged.