Stocks reverse early losses to close up; PSX immune to political worries

Stocks closed 1.42 percent higher in a seesaw trade on Thursday, recouping earlier losses sparked by a court decision on former prime minister Nawaz Sharif, as institutional investors made a comeback for bargains on shares which were beaten down heavily early in the week, dealers said.

Analyst Ahsan Mehanti at Arif Habib Corp said stocks showed recovery over reports of US failure to reprimand Pakistan in Financial Action Task Force (FATF) meeting, likely pre-poll privatisation of state owned enterprises and EU extension of GSP Plus status of Pakistan.

“Pressure was witnessed on political uncertainty (after the Supreme Court disqualified Sharif from heading the ruling PMLN) and foreign outflows; however, higher global crude prices, upbeat textile exports and remittances, and robust financial results in cement, banking, and oil sectors played a catalytic role in the bullish close.”

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index gained 1.42 percent or 608.73 points to close at 43,528.51 points. KSE-30 shares index gained 1.91 percent or 409.97 points to close at 21,819.12 points. As many as 361 scrips were active of which 226 advanced, 119 declined and 16 remained unchanged.

The ready market volumes stood at 190.64 million shares as compared with the turnover of 188.06 million shares a day earlier.

Analyst Zain-ul Abedin at Elixir Securities said market opened gap down with select blue chips carrying bearish momentum amid concerns over apex court ruling that put senate nominations by PML-N in jeopardy.

Later, sentiments turned positive “as Pakistan Oilfields hit upper price limit after Pakistan Petroleum Information Service reported significant reserves of oil and gas in new exploratory field, Jhandial in which the company holds 80 percent stake,” he added.

Financials pulled back sharply with United Bank, up 2.8 percent and Habib Bank Limited, up 3.2 percent gaining and contributing to the ascend. Engro Corp invited value buying and closed 4.7 percent up.

Going forward, analysts see market building on positive momentum and inching further up with index likely testing and possibly crossing 44,000 points level.

Companies with the highest gains included Nestle Pakistan, up Rs574.01 to close at Rs12,074/share, and Unilever Foods, up Rs398.8 to close at Rs8,900/share.

Companies with the most losses included Murree Brewery, down Rs47.92 to close at Rs910.5/share, and Service Industries, down Rs27.09 to end at Rs822.91/share.

Highest volumes were witnessed in Dost Steels with a turnover of 19.36 million shares. The scrip gained 49 paisas to close at Rs13.46/share. Azgard Nine was second with a turnover of 16.216 million shares. It shed 56 paisas to close at Rs17.59/share.

Lotte Chemical was third with a turnover of 10.24 million shares. It gained 17 paisas to close at Rs9/share.