Stocks likely to witness positive trend

KARACHI: Stocks closed higher during the outgoing week on the prime minister’s announcement of a cut in the power tariff and low inflation numbers. The market is expected to continue the positive trend next week.

“The positive momentum is expected to continue in the upcoming week. Moreover, with the result season commencing soon, certain scrips are expected to be in the limelight, driven by the expectation of better financial results,” stated a report of the brokerage Arif Habib Ltd. “Our preferred stocks are PSO, OGDC, PPL, FFC, FCCL, MLCF, LUCK, NBP and AKBL.”

The two-day trading week following the Eidul Fitr holidays commenced on a positive note, with the KSE-100 index reaching an all-time intraday high of 120,797 points on Friday. The market’s upward momentum was fuelled by the prime minister’s announcement of significant power tariff reductions of Rs7.4 per unit for consumers and Rs7.59 per unit for industries. This positive development was overshadowed, to some extent, concerns over the imposition of a 29 per cent tariff on Pakistani exports by the US.

The market closed at the level of 118,791 points, depicting an increase of 984 points or 0.8 per cent WoW. Average volumes arrived at 488 million shares (up 54 per cent WoW), while the average value traded settled at $113.6 million (up 30 per cent WoW).

Foreigner buying continued this week, clocking in at $7.38 million, compared to a net buy of $3.92 million last week. Major buying was witnessed in banks ($5.45 million), followed by all other sectors ($0.71 million). On the local front, selling was reported by insurance companies ($8.82 million) and mutual funds ($6.54 million).

Sector-wise positive contributions came from banks (1791 points), cement (86 points), fertilizer (49 points), tobacco (30 points) and real estate investment trust (19 points). Scrip-wise positive contributors were UBL (1149 points), MEBL (265 points), MCB (123 points), HBL (105 points) and BAHL (51 points).

The sectors that contributed negatively were E&Ps (410 points), power (103 points), OMCs (88 points), leather & tanneries (81 points), and cable & electrical goods (45 points). Scrip-wise negative contributions came from HUBC (128 points), OGDC (127 points), PPL (122 points) and POL (87 points).

Analyst Nabeel Haroon at Topline Securities said the KSE-100 index gained 0.84 per cent on a WoW basis, which can be accredited to a cut in electricity tariffs by the government to support consumers and industries.

Apart from it, the consumer price index (CPI) for March 2025 coming in at 0.7 per cent (lowest monthly YoY reading in over three decades) and Pakistan’s trade deficit for March 2025 clocking in at US$2.119 billion (declined by 8.0 per cent MoM) also provided stimulus to the market. The SBP reserves improved to $10.7 billion, up by $70 million WoW.

Other major news: OGDC and Mari made new discoveries; the energy sector’s circular debt reached Rs4,700 billion; bank deposits decreased by nearly 2.0 per cent to Rs30 trillion in February; coal imports hit three-year low; BankIslami launched Pakistan’s first-ever instant cheque encashment service; and LOTCHEM suspends operations for inventory management for a 21-day period.