Saturday May 18, 2024

Stocks surge 4.31pc; relief measures lure traders

By Our Correspondent
April 01, 2020

Stocks recovered more than 4 percent on Tuesday, the highest percentage increase in five years, after financial institutions and individual investors bought attractive scrips over approval of the relief package for businessmen, dealers said.

Analyst Ahsan Mehanti from Arif Habib Corporations said stocks closed bullish led by scrips across the board, as investors weighed recovery in global equities and positive outcome of government’s economic relief package along with reduced share margins and cut in SBP key policy rate.

“Investor concerns over rupee instability and foreign outflows impacted the sentiments in early session.” Recovery in global crude oil prices, and speculations on likely receipt of $1.4 billion International Monetary Fund (IMF) loan for economic relief played a catalytic role in the bullish close, he added.

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index gained 4.31 percent or 1,208.24 points to close at 29,231.63 points level. KSE-30 shares index followed suit with a high of 4.69 percent or 576.14 points to end at 12,861.22 points level.

Of 353 active scrips, 288 moved up, 56 retreated, and nine remained unchanged. The ready market volumes stood at 221.865 million shares, as compared with the turnover of 159.469 million shares in the previous session.

Samiullah Tariq, director research at Arif Habib, said, “The market responded positively on the package given by Prime Minister Imran Khan, and approved by the Economic Coordination Committee to arrest declining trend in the industrial sector.”

Moreover, it appeared that the outbreak would cool down in coming days with government gradually opening business activities in the country. Another factor which sent positive signals from the government was allowing goods transport to move on to help boost overall sentiment, he added.

Salman Ahmad, head of institutional sales at Aba Ali Habib, said as the market has plunged sharply over the preceding week, the valuations of several stocks became attractive, hence buying surfaced.

Another factor which promoted fresh buying in the oil and gas sector was the increase in crude oil prices by almost five percent, though on Monday it slipped below 19 dollars per barrel. Uncertainty about the pandemic was still haunting some of investors, till this ends, a sustained positive run in the share market would be an uphill task, he added.

Faizan Munshey, head of foreign institutional sales at Next Capital, said the stock market closed up 4.31 percent, highest percentage increase in five years, as US equity futures and European stocks headed for a 5th increase in the last six sessions.

Arif Habib Limited in their daily market analysis said the overriding factor that helped investors take a positive view on the market seems to be weakening selling pressure from foreign investors as well as the recent announcements on tax relief by the government that includes select relief on account of custom duty, additional duties and GST.

The top gainers were Rafhan Maize, up Rs487.00 close at Rs6,987.00/share, and Colgate Palmolive, up Rs99.00 to finish at Rs2,049.00/share.Sapphire Textile, down Rs61.49 to close at Rs758.50/share, and Sapphire Fibre, down Rs46.00 to close at Rs574.00/share, were the main losers.

Hascol Petrol recorded the highest volumes with a turnover of 25.779 million shares. Its scrip gained Re1 to end at Rs11.65/share.The lowest volumes were witnessed in TRG Pakistan Limited, recording a turnover of 5.283 million shares, whereas the scrip gained Re0.94 to end at Rs13.91/share.