Institutional buying sends 100-index above 20,566 points

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The Karachi Stock Exchange benchmark 100-index increased by 92.07 points to a new all time high of more than 20,566.69 points on Wednesday with two-year high turnover of above 418 million shares on institutional buying, dealers said.


Analysts said that stocks closed all time high after the statement of the Pakistan Muslim League-Nawaz chief who emphasised on improving relationships with India and US.


Overall, market stayed calm since major political tension has eased and investors express hope that the single-party led government will easily resolve economic issues.


Zafar Moti, an analyst and senior member of the KSE, said market continued to move upward on easing political tension, though there was an intraday profit-taking.


“There was selling by local investors at the start of the session, while in last one hour market saw buying by institutions and foreign funds. It performed smoothly as there was no panic amid smooth political transition,” he said.


The KSE 100-index rose by 92.07 points, or 0.45 percent, to 20,566.69 points against 20,474.62 points recorded in the last session. The index at one time during the intraday session reached to a high level of 20,646.44 points, while the lowest level of the day was recorded at 20,346.90 points.


KSE 30-index also improved by 46.73 points, or 0.29 percent, to 16,008.20 points in the session against 15,961.47 points recorded in the last session.


Trading was recorded in second and third-tier stocks. Of a total of 389 companies’ stocks traded, 196 advanced, 180 declined and 13 remained unchanged.


Along with the index, turnover and trading value also went up, while market capital went down slightly in the session.


Turnover expanded by 119 million shares to 418.70 million shares from 299.90 million shares, while value surged to Rs12.11 billion against Rs9.75 billion. However, market capital shrank to Rs4.99 trillion against five trillion rupees earlier due to intraday profit-taking.


According to analysts, exploration and production and oil marketing companies and power and banking sectors came in the limelight with market participants having believed that the first agenda the government should address was circular debt, which would result in better cash flows for some companies.


MCB Bank again closed at upper limit with foreign buyers taking interest in its stocks, while Pakistan State Oil (PSO) emerged as the top stock in the energy sector.


Exploration and production stocks other than PSO recorded profit-taking, while the price of its share climbed on the hopes that the new government will resolve the circular debt issue.


Samar Iqbal, senior manager equity sales at Topline Securities (Pvt) Ltd, said after two days of post-election rally the market underwent volatility and ended up with 100 points. “Local investors indulged in aggressive profit-taking to book gains in Oil and Gas Development Company and Pakistan Petroleum Limited,” she said. “Foreigners favourite MCB once again closed to upper limit, which helped index to rise, whereas volumes also rose to reach over two-year high.”


An analyst at KASB Research said that at one point when the KSE 100-index and select stocks were piercing through the roof, they had advised investors to watch their back with impending risks in the shape of correction appearing soon.


Fahad Ali, an analyst at JS Global, said KSE 100-index endured a rollercoaster ride, giving a way to bulls and closing up with 92 points. “The index saw a positive opening, but failed to sustain it with local institutions opting for heavy profit-taking,” he said. “However, by midday, the 100-index recovered from a low of 20,348 since the selling was defended by backstop from foreign buyers.”


Healthy volumes were witnessed at the bourse with accumulation recorded in stocks with high dividend yields and cheap multiples. “We believe the positive momentum should continue, which we believe is largely based on a sentiment-driven rally. Investors should target sectors like banking and power to include in their portfolios,” he said.


Highest increase was registered in shares of Rafhan Maize XD (by Rs211.09 to Rs4,448 per share) and Indus Dyeing SPOT (by Rs20 to Rs495 per share). Major decrease was recorded in shares of Bata (Pak) (by Rs93 to Rs1,767.01 per share) and Wyeth Pak Ltd (by Rs11.50 to Rs1,488.83 per share).


Stocks of Bank of Punjab, Karachi Electric Supply Company (KESC), Japan Power, Southern Electric, Pakgen Powerx XD, Fauji Cement, Byco Petroleum, Bank Islami Pakistan, Pakistan Telecommunication Company Limited and TRG Pakistan Ltd enjoyed significant turnover.


Bank of Punjab turned out to be the volume leader with 34.63 million shares with its share price rising 49 paisas to Rs11.80 per share. KESC was the runner-up with 27.75 million shares with its share price clocking up 80 paisas to Rs6.26 per share.


Japan Power came up as the third leading stock with 27.21 million shares with increase of Re1 to Rs3.02 per share, Southern Electric (24.60 million shares with increase of Re1 to Rs2.57 per share), Pakgen Powerx XD (22.73 million shares with increase of 60 paisas to Rs20.14 per share), Fauji Cement (21.23 million shares with increase of 13 paisas to Rs10.53 per share), Byco Petroleum (14.62 million shares with increase of 45 paisas to Rs10.99 per share), Bank Islami Pakistan (12.88 million shares with increase of nine paisas to Rs6.88 per share), PTCL (12.17 million shares with decline of 34 paisas to Rs19.41 per share) and TRG Pakistan Ltd (10.90 million shares with increase of two paisas to Rs9.53 per share).


Turnover of shares in the futures market fell to 18.75 million from 20.48 million traded in the previous session. Engro May futures led the market with 3.23 million shares with rise of Rs1.69 paisas to Rs142.23 per share, followed by PTCL May with 2.49 million shares with fall of 28 paisas to Rs19.53 per share. Out of 131 companies’ shares traded in the future market, 65 recorded increases, while 66 decreases.

Courtesy:  The News

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