Stocks stay the bullish course as six caretaker ministers sworn in

Stocks on Tuesday stayed the previous day’s bullish course to plow ahead with more gains after a six-member caretaker federal cabinet was sworn in with Dr. Shamshad Akhtar, the former central bank governor, taking the helms of the country’s financial matters, dealers said.

Zeeshan Afzal, head of research at Insight Securities, said the market continued its upward journey with decent volumes after confirmation regarding timely elections from all sources.

“Cements came in limelight after Supreme Court of Pakistan ordered to conduct hearings over delays in the construction of water reservoirs especially Kalabagh Dam next week,” Afzal said.

Pakistan Stock Exchange’s (PSX) benchmark KSE-100 shares index rose 1 percent or 434.29 points to close at 43,702.58 points, while KSE-30 shares index strengthened 1.26 percent or 268.11 points to end at 21,510.17 points.

As many as 342 scrips were active, of which 194 went up, 123 fell, and 25 remained unchanged. Ready market volumes stood at 166.489 billion shares compared to a turnover of 118.042 billion shares in the last session.

Banking sector were the major contributor in index performance, whereas institutions turned out to be major buyers in big banks which are trading at more attractive levels after recent correction.

Habib Bank gained 3.55 percent on expectations of further interest rate hikes in the coming months. Sui Northern Gas Pipelines gained 5 percent on the back of the new formula, approved by the Oil and Gas Regulatory Authority (OGRA), increasing the returns from initial draft.

From the word go, the market was in the positive column as most of the analysts believed that during the caretaker government the market would repeat the history of around 15 percent average gain. So far, the index has gained more than two percent since the announcement of caretaker prime minister.

During the session, the index dipped to 43,197 points but for a brief period and made a day-high high of 43,747 points before closing at 43,702 points with banking, cement, and gas stocks leading the activity.

Muhammad Arbash, analyst from Elixir Securities, said the market opened sideways and exhibited a range-bound behavior until midday before getting into an upward trajectory supported by gains in financials, cements, and oils, which went up by 2.2 percent, 1.3 percent, and 0.7 percent respectively. The listed gas utilities also carried momentum and traded higher after OGRA unveiled market-based tariff regime.

On the political front, caretaker six-member cabinet took oath and Dr Shamshad Akhtar assumed charge of federal finance ministry, which was received positively by the market. The overall market witnessed strong activity with traded volumes increasing by two-thirds, compared to yesterday. Companies with the highest gains were Rafhan Maize, up Rs409.89 to close at Rs8,607.89/share, and Colgate Palmolive, up Rs162.01 to close at Rs3,469.00/share. Stocks that booked the most losses were Philip Morris Pakistan, down Rs148.55 to close at Rs2,825.55/share, and Sapphire Textile, down Rs66.48 to close at Rs1263.25/share.

Bank of Punjab recorded the highest volumes with a turnover of 20.314 million shares, while its script gained Rs0.22 to close at Rs12.29/share. It was followed by Pakistan Elektron, with a turnover of 14.254 million shares. The script gained Rs0.61 to close at Rs38.96/share.

The lowest volumes were witnessed in Silk Bank Limited. It recorded a turnover of 3.679 million shares, whereas its script lost Rs0.3 to close at Rs1.29/share.