Stocks gain 533 points amid drop in govt treasury bond yields

KARACHI: Stocks closed higher by 533 points on Thursday with a rally in cement, refineries, banks and steel after government treasury bond yields were slashed.

The Pakistan Stock Exchange’s (PSX) benchmark KSE 100-share Index increased by 532.56 points or 0.68 per cent to 78,793.41 points against 78,260.86 points recorded in the last session. The highest index of the day remained at 78,996.22 points while the lowest level was recorded at 78,442.25 points.

Analyst Ahsan Mehanti at Arif Habib Corp said, “Stocks closed bullish after government treasury bond yields slashed by up to 148bps, expected to lead to a cut in the SBP’s key policy rate next month.”

He said that banking and fertilizer scrips outperformed on reports of surging fertilizer prices and banking deposits. The finance minister’s assurance of being fully engaged with the IMF and moving in the right direction for the IMF board’s approval on $7 billion extended fund facility (EFF) next month played a catalyst role in the bullish close.

The KSE-30 index increased by 132.81 points or 0.53 per cent to 25,022.36 points against 24,889.56 points.Traded shares increased by 252 million shares to 804.261 million shares from 552.564 million shares. The trading value rose to Rs16.98 billion from Rs14.59 billion. Market capital expanded to Rs10.486 trillion against Rs10.423 trillion. Of 473 companies active in the session, 261 closed in green, 138 in red and 74 remained unchanged.

Maaz Mulla, an analyst at Topline Securities, said the KSE-100 index maintained its upward trajectory, registering an intraday gain of 735 points before closing at 78,793, reflecting a 0.68 per cent increase.

“This sustained positive momentum is largely credited to yesterday’s treasury bill auction, where the government significantly lowered the cutoff yields by up to 148 basis points,” he said.

The cement and steel sectors showed marked optimism as investors anticipate a rate cut in the forthcoming monetary policy. Key players like DGKC (5.59 per cent), FCCL (4.48 per cent), KOHC (4.10 per cent), CSAP (10 per cent), ASL (4.63 per cent), and MUGHAL (3.10 per cent) closed higher than their previous session’s performance.

Notably, FFC, SRVI, NBP, PSO, and LUCK collectively contributed 355 points to the index. Conversely, profit-taking in HBL, Engro, MTL, and MEBL led to a deduction of 132 points.

The highest increase was recorded in Hoechst Pakistan Limited, which rose by Rs97.89 to Rs1,724 per share, followed by Service Industries Limited, which increased by Rs92.02 to Rs1,067.02 per share. A significant decline was noted in Sapphire Textile Mills Limited, which fell by Rs35.01 to Rs1,264.99 per share, Unilever Pakistan Foods Limited followed it, which closed lower by Rs19.46 to Rs17,800 per share.

Brokerage Arif Habib Ltd stated that the KSE-100 index touched the 79k level, driven by strong performances in cement and refinery stocks.

Heading into the final session of the week, the KSE-100 is up 0.81 per cent week-on-week, and a close above 79k could set the stage for a push back towards the 80k mark.

WorldCall Telecom remained the volume leader with 140.91 million shares which closed higher by 11 paisas to Rs1.31 per share. Kohinoor Spinning followed it with 91.356 million shares, which closed higher by 76 paisas to Rs11.99 per share.

Other significant turnover stocks included Power Cement, Yousuf Weaving, Cnergyico PK, Pace (Pak) Ltd., Symmetry Group Ltd, Dewan Cement, Fauji Cement and National Bank XD.In the futures market, 329 companies recorded trading, of which 201 increased, 122 decreased and 6 remained unchanged.