KSE-100 surges 1,918 points on lowest inflation numbers in over six years

KARACHI: Stocks had a strong start to the week, and the KSE-100 index surged by 1,918 points on the lowest inflation numbers in 78 months, which provided grounds for further ease in the monetary policy.

The Pakistan Stock Exchange’s (PSX) benchmark KSE-100 index surged by 1,917.63 points or 1.89 per cent to 103,274.95 points against 101,357.32 points recorded in the last session. The highest index of the day remained at 103,386.47 points while the lowest level was recorded at 101,921.21 points.

Ahsan Mehanti, an analyst at Arif Habib Corp, said, “Stocks showed record bullish activity amid upbeat data on CPI Inflation at 4.9 per cent YoY for November 24, likely to further ease SBP policy rates.”

He said that a bull run in global equities, strong economic data and surging forex reserves played a catalyst role in the bullish activity at the PSX. The KSE-30 index increased by 481.09 points or 1.53 per cent to 31,969.36 points against 31,488.27 points.

Traded shares increased by 641 million shares to 1,556.252 million shares from 915.509 million shares. The trading value rose to Rs47.097 billion from Rs35.978 billion. Market capital expanded to Rs13.107 trillion against Rs12.885 trillion. Of the 462 companies active in the session, 339 closed in green, 85 in red and 38 remained unchanged.

Analyst Nabeel Haroon at Topline Securities said that the positivity in the market can be attributed to Pakistan’s CPI falling below 5.0 percent for the month of November to clock in at 4.9 per cent (vs. the October CPI of 7.2 per cent), the lowest reading in 78 months.

Record participation was observed, as the traded value of Rs47 billion was highest after May 2017. Traded value wise OGDC (Rs3.84 billion), PPL (Rs1.93 billion), PSO (Rs1.44 billion), SEARL (Rs1.39 billion) and DGKC (Rs1.26 billion) dominated the activity.

The top contribution point-wise came from Engro, FFC, MEBL and FCCL, as they cumulatively contributed 617 points to the index. Investor interest was observed in cement sector as it gained 4.7 per cent on a DoD basis, on the expectation of higher dispatch numbers for the month of November where declining interest rates have started providing stimulus to the sector. The highest increase was recorded in Unilever Pakistan Foods Limited, which rose by Rs270 to Rs19,800.01 per share, followed by Service Industries Limited, which increased by Rs134.94 to Rs1,484.30 per share. A significant decline was noted in Ismail Industries Limited, which fell by Rs38.28 to Rs1,599.82 per share. Pakistan Tobacco Company Limited followed it, which closed lower by Rs20.23 to Rs1,214.96 per share. Brokerage Arif Habib Ltd said the week started on a strong note as the KSE-100 index maintained its upward momentum, building distance from the 100,000 mark.

Support is now solidifying at the 100,000 mark, with the path of least resistance appearing to be on the upside. Positive sentiment continues to drive the market, reinforcing optimism for further gains in the near term.

WorldCall Telecom remained the volume leader with 213.514 million shares which closed higher by 9 paisas to Rs1.46 per share. Cnergyico PK with 196.907 million shares followed it, which closed higher by Re1 to Rs5.72 per share.

Other significant turnover stocks included Fauji Foods Ltd, K-Electric Ltd, Sui South Gas, BO Punjab, Hascol Petrol, Pak Int Bulk, Fauji Cement and Pace (Pak) Ltd. In the futures market, 306 companies recorded trading, 255 of which increased, 49 decreased, and 2 remained unchanged.