Stocks rebound 2.09 percent ahead of quarterly earnings

Stocks rallied more than two percent on Friday as a spurt of positive news encouraged institutional investors to take fresh positions on attractive valuations, dealers said.

“Cements provided a much-needed push as the sector rallied full throttle with investors rejoicing news of upcoming meetings by cement players for resolution of pricing issues,” Elixir Securities said in a post-market comment.

The KSE 100-share Index of Pakistan Stock Exchange gained 2.09 percent or 844.10 points to close at 41,312.59 points. KSE 30-share Index surged 2.35 percent or 483.26 points to end at 21,037.62 points. As many as 386 shares were active; of which 288 increased, 78 decreased and 20 remained unchanged.

The ready market volume stood at 147.763 million shares as compared to 150.272 million shares a day earlier. Dealers said equities traded higher to settle above the 41,300-point level, helped by gains in the major sectors, including cement.

The market struggled for a direction in the first 15 minutes, but later cement, automobile and oil sectors caught investor attention. Analyst Ahsan Mehanti at Arif Habib Corp said stocks closed higher across the board on institutional interest on robust sales data from oil and cement sectors ahead of quarterly earnings’ announcement season.

“Rising exports, foreign inflows and local cement prices and subdued political noise played a catalytic role in bullish close,” Mehanti added. All the cement stocks ended up with DG Khan Cement (up 5 percent) hitting the upper price limit, while Maple Leaf Cement (rising 4.3 percent) traded the second-best volume of more than nine million shares on volume chart.

Oil and financial sectors followed the lead and edged up on cherry-picking, albeit witnessing a relatively lower activity as evident from flattish volume going through in benchmark indices. Analysts expect current momentum to continue with cement sector remaining buoyant and likely helping the 100-share Index surpass the key resistance level of 42,000.

Companies, reflecting highest gains, included Mari Petroleum up Rs51.69 to close at Rs1,542.05/share and Indus Motors increasing Rs47.34 to end at Rs1,670.02/share. Companies, with the most losses, included Sanofi Aventis down Rs56 to end at Rs1,726/share and Bhanero Textile decreasing Rs38.08 to close at Rs723.63/share.  Highest volumes were witnessed in TRG Pakistan with a turnover of 10.177 million shares. Its share value gained Rs1.66 to close at Rs35.86/share. Maple Leaf Cement was the second with a turnover of 9.09 million shares. Its stock price was up Rs3.18 to end at Rs77.18/share. K-Electric was the third with a turnover of 8.497 million shares. It increased 24 paisas to finish at Rs6.93/share.