Stocks rally as investors upbeat on economy in PTI-led government

Stocks rallied more than one percent on Friday, as investors bet on the expected outcome of the last leg of the election process, with Imran Khan becoming the 22nd Prime Minister of Pakistan and improving the economic climate of the country, dealers said.

Analyst Ahsan Mehanti from Arif Habib Corporation said stocks closed bullish amid high trade as investor cheered NA election for the new PM’s appointment. “Earnings season rally was led by cement and banking scrips after investors weighed Fitch statement on likely funding from IMF, China to meet external imbalances.”

Oil sector remained under pressure on concerns over the pending circular debt and weak global crude prices. Reports of rise in local urea prices and upbeat data on cement and fertiliser sales for July 2018 played a catalytic role in the bullish close, he added.

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index rose 1.16 percent or 485.82 points to close at 42,446.62 points. KSE-30 shares index rose 1.33 percent or 275.52 points to end at 20,926.68 points.

Of the 376 active scrips, 266 advanced, 91 declined, and 19 remained unchanged. The ready market volumes stood at 194.194 billion shares as compared with the turnover of 142.178 billion shares in the previous session.

Zeeshan Afzal, head of research at Insight Securities, said the bulls remained in action for the entire session amid positive momentum created by voting for the next Prime Minister.

Local individuals, insurance players, and mutual funds remained key buyers during the session, while buoyancy of liquidity with local mutual funds and individuals also acted as a catalyst, he added.

Cements, steel and fertiliser were robust, while dollar hedge themes remained top-picks. Financials, IT, textiles and IPPs would expectedly outperform the benchmark, an analyst said.

From January 1, 2018, the market has witnessed $240 million net selling from foreign investors and foreign financial institutions, which dampened the mood of the local financial institutions as well, an analyst said.

Companies reflecting highest gains included Service Industries Limited, up Rs37.24 to close at Rs782.23/share, and Wyeth Pakistan Limited, up Rs19.00 to close at Rs1,349.00/share.

The major losers were Indus Dyeing, down Rs25.26 to end at Rs480.14/share, and Blessed Textile, down Rs19.00 to close at Rs361.00/share.

The highest volumes were witnessed in Bank of Punjab with a turnover of 39.047 million shares. The scrip gained Rs0.68 to close at Rs11.94/share. It was followed by Unity Foods Limited with a turnover of 7.406 million shares. Its scrip gained Rs1.91 to close at Rs40.30/share.

Al-Ghazi Tractors Limited witnessed the lowest volumes with a turnover of 3,900 shares. Its scrip lost Rs1.47 to close at Rs663.53/share.