Stocks gain on oil and banking rally; KSE-100 nears 66,000 level

Stocks closed higher on Tuesday as investors rallied behind the oil and banking sectors on strong valuations, dealers said.

The Pakistan Stock Exchange's (PSX) benchmark KSE 100-share Index gained 380.63 points, or 0.58 percent, to close at 65,906.28 points. The highest index of the day remained at 65,989.54 points, while the lowest level was recorded at 65,492.71 points. The KSE-30 index increased by 128.84 points, or 0.60 percent, to 21,707.85 points.

"Stocks closed higher, led by oil and banking scrips on strong valuations," said analyst Ahsan Mehanti at Arif Habib Corp. "Surging global stocks, rupee stability amid foreign inflows, and higher global crude oil prices played a catalytic role in the bullish close at the PSX."

Traded shares increased by 42 million shares to 303.710 million shares from 261.194 million shares. The trading value rose to Rs12.078 billion from Rs8.945 billion. Market capitalization expanded to Rs9.265 trillion from Rs9.211 trillion. Of the 336 companies active in the session, 173 closed in the green, 144 in the red, and 19 remained unchanged.

Analyst Naveed Nadeem at Topline Securities said the stock market concluded with the index reaching 65,906, marking a 0.58 percent increase, or 381 points. "Throughout the day, the index exhibited a mixed performance, experiencing intraday highs and lows at 65,990 and 65,493 points, respectively."

Contributing positively to the index were the fertilizer, banking, and cement sectors, with FFC, MEBL, UBL, LUCK, and ENGRO collectively adding 305 points. Conversely, EFERT, BAFL, and MCB incurred losses totaling 51 points.

The highest increase was recorded in Rafhan Maize Products Company Limited shares, which rose by Rs89.89 to Rs8,290 per share, followed by Sapphire Fibres Limited, which increased by Rs87.50 to Rs1,582.50 per share. A significant decline was noted in Bata Pakistan Limited, which fell by Rs37.17 to Rs1,680 per share, followed by Philip Morris (Pakistan) Limited, which closed lower by Rs25 to Rs710 per share.

Brokerage Arif Habib Ltd stated that the benchmark index is once again approaching the 66,000 points mark, having been tested in six trading sessions since the beginning of the month. "Despite several attempts, the index has yet to breach this significant level."

Market sentiment continues to lean towards an eventual breakthrough, with expectations for the index to surpass its previous highs. Current price action suggests a favorable outlook for the index to breach the 66k mark this week, potentially leading to accelerated gains.

Furthermore, PIAA witnessed a notable surge of 7.5 percent following board approval for the restructuring and privatization of the airline, indicating positive investor sentiment toward the development.

On another front, the FTSE is set to release its fixed income and equity country classification review of markets on Wednesday, March 27, after the close of the US market. Pakistan is on the watchlist for potential demotion, transitioning from Secondary Emerging to Frontier market status.

According to FTSE, Pakistan will be evaluated against the minimum investable market capitalization exit level threshold, set at USD 3.5 billion, based on data as of the close on Friday, December 29, 2023. As of the closing of CY23, Pakistan met this threshold, signaling a crucial factor in the upcoming assessment.

PIAC (A) remained the volume leader with 30.297 million shares, which closed higher by Rs1.77 to Rs25.39 per share. PTCL followed it with 28.146 million shares, which closed higher by 40 paisas to Rs16.10 per share.

Other significant turnover stocks included National Bank XD, Oil & Gas Dev., WorldCall Telecom, Pak Reinsurance, Hascol Petrol, Agritech Limited, The Organic Meat, and Cnergyico PK. In the Future Market, 319 companies recorded trading, of which 153 increased, 157 decreased, and 9 remained unchanged.