Stocks gain one percent; track regional peers

Stocks rose over one percent on Tuesday with gains in regional markets supported buying at home, while institutional and foreign investors also accumulated undervalued cement and financial shares, dealers said.

Analyst Ahsan Mehanti at Arif Habib Corp said stocks showed sharp recovery, led by oversold cement, banking and auto scrips on strong earnings outlook. Reports of rising urea and Di-ammonium phosphate off-take and corporate restructuring in second- and third-tier stocks played a catalyst role in the bullish close.

The Pakistan Stock Exchange’s (PSX) benchmark 100-share Index closed higher 1.05 percent or 410.87 points to 39,688.98 points. The highest index of the day remained at 39,769.79 points, while the lowest level of the day was recorded at 39,252.60 points.

KSE 30-share Index closed up 1.28 percent or 284.55 points to 22,557.25 points. Turnover rose 78 million shares to 330.21 million shares. Trading value increased to Rs14.05 billion as against Rs9.94 billion while the market capital expanded to Rs7.98 trillion from Rs7.92 trillion. Of a total of 427 companies, 231 ended up, 173 closed down and 23 remained neutral.

Analyst Ahmed Saeed Khan at JS Research said the PSX followed the trend of its regional and global peers. “The positive sentiments at the bourse were led by the banking and cement sectors,” Khan said. “Investors flocked towards the cement sector (up 1.9 percent) as concerns on oversupply of cement abated.”

Analyst Faisal Bilwani at Elixir Securities said equities snapped the five-day losing streak and closed with sharp gains on aggressive institutional buying in the index names. “After a positive open, stocks drifted lower for a brief period as the benchmark index tested 39,250 level on thin volumes,” Bilwani said. “However, the wider market witnessed swift recovery thereafter as foreign investors reportedly turned aggressive buyers in cements and financials.”

Resultantly, Lucky Cement was up 1.7 percent, followed by DG Khan Cement (2.5 percent) and Maple Leaf Cement (2.1 percent), while Habib Bank Limited also rose 4.9 percent, followed by United Bank Limited (2.8 percent) and MCB Bank Limited (1.7 percent).

Oil sector traded against the market direction and closed in the red. Pakistan Petroleum inched down 1.8 percent, correcting after the management update on the asset impairment. Highest increase was recorded in Service Industries Ltd by Rs61.73 to Rs1,296.39/share, followed by Ghandhara Industries that rose Rs32.52 to Rs682.92/share. Major decrease was registered in Rafhan Maize XD by Rs200 to Rs7,400/share, followed by Unilever Foods that fell Rs150 to Rs5,350/share.

Significant turnover was recorded in stocks of Byco Petroleum, WorldCall Telecom, Dewan Cement, K-Electric Ltd, Pace (Pak) Ltd, Maple Leaf Cement, Sui Northern Gas Pipelines Ltd, Jahangir Siddiqui Co, DG Khan Cement and Dewan Salman.

Byco Petroleum was the volume leader with 32.46 million shares with a drop of 22 paisas to Rs25.53/share. It was followed by WorldCall Telecom with 27.16 million shares with an increase of 25 paisas to Rs1.88/share. Shares’ turnover in the future contracts rose to 16.53 million from 15.22 million.