KSE-100 recovers 594 points amid rate cut hopes

KARACHI: Stocks recovered on Thursday; the benchmark KSE-100 index increased by 594 points, reflecting expectations of further monetary easing this month.

The Pakistan Stock Exchange’s (PSX) benchmark KSE-100 index increased by 594.36 points, or 0.52 per cent, to 114,037.79 points, down from the 113,443.43 points recorded in the last session. The highest index of the day remained at 114,319.62 points, while the lowest level was recorded at 113,234.31 points.

Ahsan Mehanti, an analyst at Arif Habib Corp, said, “Stocks showed recovery in the earning season rally amid a drop in treasury bond yields by up to 41bps and expectations over reductions in industrial power tariff after IMF approval.”

He said that upbeat data on the $1.2 billion current account surplus for July-December 2024, easing political risk and speculations ahead of the SBP policy decision next week played a catalyst role in a further surge at the PSX.

The KSE-30 index increased by 159.04 points or 0.45 per cent to 35,794.35 points against 35,635.31 points.

Traded shares decreased by 68 million shares to 675.54 million shares from 743.632 million shares. The trading value dropped to Rs30.469 billion from Rs35.245 billion. Market capital expanded to Rs14.067 trillion against Rs14.001 trillion. Of 442 companies active in the session, 213 closed in green, 181 in red, and 48 remained unchanged.

Analyst Naveed Nadeem at Topline Securities said the market saw a positive performance in Thursday’s trading session, with the index reaching an intraday peak of 114,320 points before closing at 114,038, reflecting an increase of 594 points or 0.52 per cent. “The market sentiment was buoyed by recent foreign corporate buying, and cement stocks remained in focus,” he said.

Key contributors to the positive movement included Engro, PSO, FCCL, SEARL and MLCF, adding 309 points to the index.

The highest increase was recorded in Ismail Industries Limited, which rose by Rs92 to Rs1,949.50 per share, followed by Pakistan Engineering Company Limited, which increased by Rs67.80 to Rs806.14 per share. A significant decline was noted in Unilever Pakistan Foods Limited, which fell by Rs210 to Rs21,690 per share; Sapphire Textile Mills Limited followed it, which closed lower by Rs76.94 to Rs1,147.82 per share.

Analyst Muhammad Hasan Ather at JS Global said the rally was mainly driven by robust buying in the cement sector and heightened expectations of a 100bps interest rate cut in the upcoming Monetary Policy Committee (MPC) meeting. “Ongoing monetary easing will likely stimulate economic activity, increase corporate earnings, and drive the KSE-100 index to new highs,” he said.

He added, “Falling yields witnessed in yesterday’s T-bill auction bolstered market sentiment.” Cnergyico PK remained the volume leader with 143.693 million shares, which closed higher by 57 paisas to Rs7.93 per share. WorldCall Telecom, with 78.194 million shares, followed it, which closed higher by 9 paisas to Rs1.79 per share.

Other significant turnover stocks included Fauji Cement, Lotte Chemical, Citi Pharma Ltd, Maple Leaf, Fauji Foods Ltd, K-Electric Ltd, DGK Cement and Treet Corp. In the futures market, 300 companies recorded trading, 182 of which increased, 112 decreased and 6 remained unchanged.