Stocks on Wednesday snapped out of a two-day rout on cyclical strength, especially cement sector, in volatile trade, amid support from banks, autos, and engineering shares, dealers said.
The KSE-100 shares index, the benchmark of Pakistan Stock Exchange (PSX), gained 0.42 percent or 180.76 points to close at 43,087.70 points. Volumes decreased to 378.938 million shares, from 561.855 million on Tuesday. KSE-30 rose 0.46 percent or 82.08 points to end at 17,939.18 points.
Muhammad Saeed Khalid, head of research at Shajar Capital said the market remained range bound, despite recovering balance of payments numbers, marking an intra-day high of 310 points, closing at just above 43,000 index levels.
The index performed mainly on the performance of oil scrips where OMCs and refinery stocks outperformed, despite pilling up of oil inventories in the international market after another wave of COVID-19 in G20 countries, Khalid added.
A A Soomro, managing director at KASB Securities, said the index saw a change of fortunes on Wednesday.
“The much hot technology sector seems to be cooling off with new momentum building up in autos, cements, engineering, and glass sectors,” he said. Soomro added that the government’s willingness to increase tariff in order to restart IMF program was taken positively by the market along with expected $500 million debt issuance for dams’ construction.
“House seems to be getting in order,” he said adding, “The market is expected to remain neutral to positive on Thursday also as a carry over trade from today’s closing”. “However, due to long weekend, we expect the new year to start on a positive note. Meanwhile, year-end closing effect might be seen in selective stocks,” Soomro added.
Trading activity was recorded in 387 active scrips, of which 231 improved, 136 went down, and 20 ended unchanged.
Ovais Ahsan, CEO at Optimus Capital Management, said the market bounced back after Tuesday’s selloff as the cement and steel sector rallied on rising prices and demand.
The news that WAPDA will raise $500 million through eurobond issues to fund major dams propelled the cement sector with MLCF, PIOC, and CHCC adding most to the index, Ahsan said.
“Infrastructure related stocks dominated the index with ASL and GHGL leading the steel and glass sectors respectively,” Ahsan added.
Shahab Farooq, director research at Next Capital, said the market remained volatile, while moving in both directions and eventually closed positive with major contribution coming from bank and cement sectors.
“Provisional numbers for cement dispatched during the current month portrays a very healthy picture that fuelled positive sentiment in the sector,” Farooq added.
Analyst Ahsan Mehanti from Arif Habib Corporation said stocks showed recovery on strong earnings outlook and surge in global crude oil prices. Current account surplus of $447 million in November, $1.7 billion debt relief, surging exports, auto sales, cement dispatches, fertiliser offtake, and $11.8 billion home remittances for Jul-November buoyed the stocks, Mehanti added.
The top gainers of the day were Gillette Pakistan, up Rs39.29 to close at Rs563.25/share, and Premier Sugar, strengthening by Rs29 to finish at Rs449/share. Sapphire Textile, down Rs76.30 to close at Rs9,68.02/share, and Nestle Pakistan, losing Rs62.50 to close at Rs6637.50/share, were the worst losers.
Pakistan Refinery topped the trade chart with 26.978 million shares. The refiner gained Rs1.03 to end at Rs20.38/share. Netsol Technology was at the bottom in terms of turnover with 10.140 million shares, while it lost Rs3.14 to end at Rs178.92/share.
Source: The News