Stocks soar higher on stability bets
Stocks on Monday matched the Friday’s stride as the rally set off by government’s Senate recovery endures, dealers said.
KSE-100 shares index gained 2.23 percent or 978.51 points to close at 44,766.59 points. On a day-on-day basis total traded volume rose 2.9 percent to 455.35 million shares, while value grew 1.6 percent to Rs21.95.
Topline Securities in a note said clarity over senate chairmanship buoyed sentiment, while investors shrugged off concerns of a higher inflation and political noise arising from Long March and PPP’s challenging the Senate chairmanship election in Supreme Court.
Major positive contributors were TRG, PSO, LUCK, SYS, and HUBC that cumulatively added around 327 points to the index, the brokerage said. As many as 403 scrips were active, of which 332 advanced, 59 declined, and 12 remained unchanged.
Arsalan Soomro at KASB Securities said the battle between bulls and bears had apparently ended after Friday's election of Senate Chairman. “Sanjrani’s chairmanship gives assurance to investors and the government to pass structural reforms needed to improve the economic web”.
Several good quality stocks had fallen 25-30 percent from their recent peak levels only to end on a very strong note on Monday, Soomro added. “While the Prime Minister is directing to defer gas price hike till budget to counter it with targeted subsidies, necessary bills to be passed – State Bank, state-owned enterprises, Income Tax, NEPRA Acts - are needed to revive IMF plan and pave way for global bond issuance,” Soomro said adding the market was expecting painful reforms to be enacted sooner.
KSE-30 Shares Index gained 2.31 percent or 420.16 points to close at 18,569.53 points. The rally was mainly driven by technology, cement, and refineries. Cement sector remained in the limelight with Fauji Cement gaining 1.9 percent, Maple Leaf Cement 5.4 percent, D.G Khan Cement 3.7 percent, and Pioneer Cement closing 7.4 percent higher.
Ahsan Mehanti at Arif Habib Corp said the bullishness was led by scrips across the board as investors weighed easing political uncertainty after Senate elections.
Investor interest was particularly visible in techs, where AVN Technologies, Netsol, and TRG Pakistan closed on their upper circuits. An analyst at Arif Habib Limited said, “Leveraged positions have come off lately, whereby leverage in Margin Trading, Margin Financing and futures stood Rs45 billion on March 8th, and by the end of the week declined to Rs35 billion”.
The government’s win of Senate chairmanship also helped investors make view on index, the brokerage said. “Emergence of third wave of Covid has led to reintroduction of lockdown measures by federal and provincial governments that may temporarily hamper economic activities, but the brunt of the severity is likely to be lesser than before,” Arif Habib report added.
Rafhan Maize, securing Rs690 to close at Rs10,190/share, and Nestle Pakistan, grwoing Rs286.25 to close at Rs6,036.25/share, were the best gainers of the day. Sunrays Textile, shedding Rs71.03 to close at Rs876.97/share, and Wyeth Pakistan giving up Rs21.54 to end at Rs983.58/share, ended up as the worst losers.
TRG Pakistan led volumes chart with 24.89 million shares. The scrip gained Rs8.99 to close at Rs128.98/share. Unity Foods was second with 23.63 million shares. It gained Rs1.99 to close at Rs28.55/share. Fauji Cement was third with 21.08 million shares. The cyclical stock gained 44 paisas to finish at Rs23.10.
