Stocks up 448 points amid speculations of a policy rate cut

KARACHI: Stocks increased on Tuesday after two sharp declining sessions, as there were speculations regarding a policy rate cut in the upcoming State Bank of Pakistan policy announcement.

The Pakistan Stock Exchange’s (PSX) benchmark KSE-100 share index increased by 447.90 points or 0.57 per cent to 78,987.09 points against 78,539.19 points recorded in the last session. The highest index of the day remained at 78,634.15 points while the lowest level was recorded at 78,634.15 points.

Analyst Ahsan Mehanti at Arif Habib Corp said, “Stocks showed recovery amid speculations over projections for the SBP rate cut ahead of the SBP’s policy announcement on July 29.”He said the National Assembly Standing Committee’s approvals over new privatization laws aiming to reduce delays, postponement of cabinet meetings to ban opposition limiting the government’s constitutional powers, and Fitch ratings lauding fiscal measures and improving economic indicators played a catalyst role in the bullish close at the PSX.

The KSE-30 index increased by 156.79 points or 0.62 per cent to 25,365.07 points against 25,208.28 points.Traded shares decreased by 59 million shares to 316.245 million shares from 375.599 million shares. The trading value dropped to Rs17.074 billion from Rs19.350 billion. Market capital expanded to Rs10.5 trillion against Rs10.456 trillion. Of 433 companies active in the session, 225 closed in green, 164 in red and 44 remained unchanged.

Naveed Nadeem, an analyst at Topline Securities, said the Pakistan stock market demonstrated positive momentum as the index peaked at 79,585 points earlier in the day before settling at 78,987 points, marking a gain of 448 points or 0.57 per cent.

The market’s upward trend was propelled by sectors such as exploration & production (E&P), banking, and auto, buoyed by companies including HUBC, OGDC, MARI, UBL, and MTL, collectively contributing 228 points.

The highest increase was recorded in Unilever Pakistan Foods Limited shares, which rose by Rs74.08 to Rs18,200 per share, followed by Lucky Core Industries Limited, which increased by Rs61.25 to Rs966.36 per share. A significant decline was noted in PIA Holding Company Limited, which fell by Rs95.42 to Rs858.78 per share, Pakistan Engineering Company Limited followed it, which closed lower by Rs51 to Rs670 per share.

Brokerage Arif Habib Ltd stated that the KSE-100 experienced a modest recovery following a sharp two-day correction, which had dragged the index back below the 80,000 mark.

FFBL remained a standout performer, with a notable increase of 3.08 per cent, buoyed by ongoing speculation about a potential amalgamation with FFC PA, which itself rose by 0.59 per cent. This potential merger has kept FFBL well bid throughout the trading day, reflecting investor optimism about the strategic move.

Market analysts suggest that while the KSE-100’s current view remains focused on stabilizing around the 77,500 to 78,000 range, there is potential for further declines. The index’s ability to regain the 80,000 level would be a positive indicator that the recent correction has run its course, and that stability is returning to the market.PIA Holding Company remained the volume leader with 22.079 million shares which closed lower by Rs2.39 to Rs15.63 per share. Pak Elektron followed it with 19.793 million shares, which closed lower by 33 paisas to Rs26.26 per share.

Other significant turnover stocks included WorldCall Telecom, Fauji Fert Bin, Air Link Commun, K-Electric Ltd, Silk Bank Ltd, Avanceon Ltd, Waves Home App and Netsol Tech.In the futures market, 306 companies recorded trading, of which 172 increased, 125 decreased and 9 remained unchanged.