Stocks race ahead with banks, cements in driving seat

Getting over the trading roadblocks, mostly created by the political crisis that is about to reach its climax, stocks on Friday raced ahead with banks and cements in the driving seat, traders said.

Pakistan Stock Exchange (PSX)’s benchmark KSE-100 index gained 223 points or 0.50 percent to close higher at 4,5152.

Topline Securities in its post-trading commentary said the index opened on a negative note but picked up positive pace as the day progressed.

The brokerage attributed the positivity in market to no-confidence voting against Prime Minister on Sunday in parliament, which investors expect put an end to the prevailing political uncertainty in the country.

Major contribution to the index came from UBL, ENGRO, TRG, HMB, and INDU as they cumulatively added 146 points, the brokerage said adding that on the flip side COLG, EFERT, SRVI, ABL, and SCBPL together dented the index by 76 points.

JS Research in its market wrap said the market was on a roller-coaster ride as the political showdown was nearing its end.

Overall participation remained healthy, while the market made a high and low of 45,396 and 44,655 points.

The JS analysts in their report recommended investors to avail any downside as an opportunity to buy in the cement, banking, technology, and textile sectors.

The turnover dropped to 389 million shares compared to 415 million; however, trading value increased to Rs11.1 billion against Rs9.67 billion. The market capitalisation inched up to Rs7,599 billion from Rs7,582 billion on Thursday.

Brokerage Arif Habib Limited in its research report said the market started in the red territory because of political unrest and continuous devaluation of rupee against dollar, amid volatile trade.

UBL and MCB rallied on expectations that foreign selling spree in banking sector was losing steam, while cement hit limelight on easing international coal prices, the brokerage said.

It added that value-buying in the second session led the index to close in the green zone.

Sectors contributing to the performance included banks (+125.7 points), technology (+34.1pts), fertilisers (+31.96 points), auto assemblers (+28.3 points) and textiles (+14.2 points).

Volumes decreased from 415.6 million shares to 389.1 million shares, showing a 6.4 day-on-day decline. Average traded value improved 14.8 percent to reach $60.3 million as against $52.6 million.

Telecard Limited was the volume leader with 35.4 million shares.

Other major turnover contributors included TPL Properties, Treet Corp, Pak Elektron, Ghani Global Holdings, Cnergyico PK, Agritech Limited, WorldCall Telecom, TPL Corp Limited. and TRG Pak Ltd.

In the ready market, 183 companies ended positive, 149 negative, and 32 closed unchanged.

Foundation Research in a report said elevated current account deficit, increasing inflation and stalled IMF programme amid heightened political noise would keep the upside of the market in check.

“Increased current account deficit has put significant pressure on foreign exchange reserves amid high commodity prices and debt repayments,” the brokerage said.

It added that while rising local demand due to subsidy on oil and electricity prices for providing relief to the masses in heated political environment had further aggravated the situation. “However, cooling off of commodity prices due to extension in China lockdown and peaceful resolution of Russia-Ukraine war along with clarity on the political setup would lift investor sentiment,” Foundation Research report said.