Index upbeat as global crude rally stokes local energy scrips

The capital market surged on Thursday as sustained increase in global crude oil prices stoked a volumetric rally in domestic energy scrips, supported further by upbeat economic data, dealers said.

Pakistan Stock Exchange (PSX) benchmark KSE-100 shares index gained 0.94 percent or 406.50 points to close at 43,766.69 points. Last time the index closed at 43,931 points was on June 11, 2018.

The volumes increased to 497.562 million shares, as compared with the turnover of 702.210 million shares in the previous session.

The current level of the index is now the highest level during the current government’s tenure.

Average Traded Volume went up by nine percent to 606 million shares, while Average Traded Value (regular) increased by five percent to Rs22 billion compared with Wednesday.

KSE-30 shares index followed suit with a high of 0.94 percent or 170.02 points to end at 18,271.64 points level.

Salman Ahmad, head of institutional sales at Aba Ali Habib said the index continued in the positive column, where it reached an all time of 2020, breaching the previous best achieved in June 2018.

The rally sustained over continuous rise in crude oil prices, which impacted the local oil and gas sector. Selected buying in autos, cement and pharmaceuticals helped consolidate gains, he added.

Muhammad Saeed Khalid, head of research at Shajar Capital said that despite prevailing uncertainty caused by the petroleum industry scam, KSE-100 index stayed bullish, marking an intra-day high of 43,794 index level.

“We have witnessed another high volumetric session, where investors bought heavily in the petroleum and tech stocks, despite decline in FDI numbers by 17 percent YoY during 5MFY21,” he said.

Khalid said the robust activity could be attributed to improved economic stability and forex reserves level, along with a payment of $1 billion to the Saudi authorities.

Trading activity was recorded in 416 active scrips, of which 304 increased, 93 lost, and 19 remained unchanged.

Tahir Abbas, director research at Arif Habib said increase in economic activity, positive growth in the manufacturing sector, and healthy tax collection numbers bolstered investor sentiments.

A general belief that Covid-19 recoveries have started picking up also played a positive role, with more help from news coming in from US and other countries on vaccine clearances, Abbas added.

Analyst Ahsan Mehanti from Arif Habib Corporations said, “Stocks closed bullish on strong earnings outlook and surge in global crude oil prices.”

Upbeat economic data on Roshan Digital Account receipts, exports, auto sales, cement and fertiliser sales and home remittances in November 2020, Moodys upgrade on blue chip banks, ADB report on likely economic growth to 2.8 percent and talks on resolution of circular debt played a catalytic role, Mehanti added.

Khyber Tobacco, up Rs30 to close at Rs430/share, and Gillette Pakistan, strengthening by Rs29.42 to finish at Rs421.78/share, were the winners.

Rafhan Maize, down Rs100 to close at Rs9,000/share, and Nestle Pakistan, losing Rs30 to close at Rs6,900/share, were the main losers.

Pakistan Refinery led volumes with 45.135 million shares. The scrip gained Rs1.55 to end at Rs22.55/share.

Fauji Fertiliser Bin posted the lowest turnover with 14.405 million shares. It gained Re0.93 to end at Rs23.55/share.