Cement leads strong rally at KSE

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KARACHI : Shares extended the grand rally at the Karachi stock market on Friday adding a staggering 313.96 points or 1.36 per cent to the KSE-100 index, which closed at 23,428.93.


Aggressive purchases by foreign fund managers; renewed upsurge in prices of second and third-tier cement stocks and investors’ interest in Engro Corporation saw the market in bullish mood regardless of the shortened trading time on Fridays in the month of Ramazan.


Foreigners’ were bullish on the Pakistan equity, represented by stronger inflows on Friday amounting to $3.34 million. Most local participants, however, thought it prudent to lock-in profit on the last day of the week. Banks sold shares worth $2.84 million; companies offloaded $0.65 million worth stocks and individuals also were net sellers of shares valued at $1.21 million.


Mutual Funds, which had liquidated their positions on Thursday picked up stocks worth $0.80 million on Friday. But the rally was led by the cement sector, where Pioneer, Maple Leaf, Cherat and Kohat Cement, all closed at their ‘upper circuit’ or with maximum gain of 5 per cent.


Dealers at the AHL Equity Sales stated that cement sector was heavily traded as the sector in general was trading at a discount to the current market multiples.


Also with improvement of financial position of most of the companies in the sector, the gap between market and the sector valuations was likely to reduce in coming months.On the fertiliser sector Engro and Dawood Hercules closed at their ‘upper circuit’. Engro alone added 39 points to the index.


The government’s effort to initiate projects and increase trade with the Asian and European region was ringing the right chord with the investors. The approval by Economic Coordination Committee to import LNG from Qatar and in this context the construction of storage terminal by Engro and Sui Southern increased interest in the stock.Dealers at brokerage Sherman Securities said that rebound was due as stock prices had fallen significantly in the last few days. Engro mopped up strong gains. Banks were up on expectations of increase in discount rates.


Power companies like NPL and NCPL witnessed better volumes.


Analyst Ahsan Mehanti observed that the index closed at all time high after current account deficit at $2.3bn stood lower than expected at 1pc of GDP on release of coalition support fund and FDIs despite IMF repayments burden.


Bullish activity was witnessed in stocks across the board amid speculations ahead of major earnings announcements due next week.


In all, 360 stocks were traded with gainers at 243, far ahead of the laggards at 94.


Turnover increased to 238 million shares on Friday, from 182 million shares the previous day. Trading value also rose to Rs9.1bn, from Rs8.2bn. Market capitalisation surged by Rs72bn to Rs5.703 trillion, from Rs5.630tr.


On the volume leaders’ list, Bank of Punjab stood at the top with 31 million shares, up by 95 paisa to Rs15.07.


Fauji Cement gained 24 paisa to Rs14.38 on 16m shares; Maple Leaf gained Rs1.36 to hit ‘upper lock’ and closed at Rs28.57 on 16m shares; Faysal Bank rose by 51 paisa to Rs12.27 on 13m shares; PIA was up 11 paisa to Rs8.99 on 8m shares; NBP gained 63 paisa to Rs55.30 on 8m shares; Askari Bank added 75 paisa to Rs16.66 on 6m shares; Nishat Mills rallied by Rs4.31 to Rs110.15 on 6m shares; Media Times shed 2 paisa to Rs3.51 on 6m shares and Jah.Sidd.Co slipped 4 paisa to Rs13.12 on 5m shares.

Courtesy:  Dawn

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