PSX rallies for third day as IMF loan likely in sight

Stocks shovelled in more gains on Wednesday, stretching the rally to third day amid buzz the International Monetary Fund's (IMF) $6 billion loan is now unlikely to hit any bump in the road, traders said.

Capital market’s key gauge, KSE-100 Shares Index, grabbed 444.65 points or 0.97 percent to close at 46,119.15 points at Pakistan Stock Exchange (PSX), exploring a high and a low of 46,138.61 and 45,674.50 points during the day’s trade.

Analyst Ahsan Mehanti at Arif Habib Corp said stocks closed bullish amid higher trades on speculations on financial results and hopes for release of IMF tranche this week.

Surging global crude oil prices, upbeat data oil sales in January, and expectations of the positive outcome of Prime Minister’s visit to China supported the rally, Mehanti said.

KSE-30 Shares index also followed the benchmark’s suit to gain 155.39 points or 0.87 percent to close at 18,069.22 points.

Ready market volume increased 48 million shares to 360.80 million from 312.50 million on Tuesday, while traded value rose to Rs10.93 billion from Rs9.48 billion. Market capital expanded to Rs7.863 trillion from Rs7.809 trillion. Out of 381 actives in the session, 269 posted gains, 91 losses, while 21 remained unchanged.

Topline Securities said equities opened on a positive note betting the IMF executive board would take a positive decision after the sixth review, while receipt of $1 billion from Sukuk proceeds further garnered investor interest.

Major contribution came from HBL, PPL, and LUCK as they cumulatively added 106 points to the index.

Ismail Industries led the gainers, securing Rs32.79 to close the day at Rs470.07 per share, followed by Mari Petroleum XD that jumped Rs31.89 to Rs1,699.90 per share.

Sapphire Textile took the biggest hit of the session, losing Rs81.22 to end at Rs1,001.78 per share, followed by Sapphire Fiber, down Rs67.42 to finish at Rs831.58 per share.

According to analysts, despite an overall non-threatening atmosphere on the economic front, inflation remains a risk.

Consumer prices inflation rose 13 percent in January from a year earlier, increasing for a fifth month in a row at the fastest pace in nearly two years in a sign of broadening inflationary pressure from rising energy and food costs.

CPI (Consumer Price Index) was at 12.3 percent earlier. The latest number is the third highest CPI reading during the last ten and a half years. Previously, it was recorded at 13.3 percent in June 2011 and 14.6 percent in January 2020, the Pakistan Bureau of Statistic (PBS) data showed.

JS Research in a report said the market was hoping the outcome of IMF talks would be positive since all the required conditions had been fulfilled.

“Going forward, we expect the market to perform well and recommend investors to accumulate stocks on dips,” the brokerage suggested to investors.

Hum Network led volumes chart with 48.78 million shares, followed by Telecard Limited with 28.28 million shares.

Among well-trades stocks were Treet Corp, WorldCall Telecom, Ghani Global Holdings, TPL Corp Ltd, Unity Foods Ltd, TRG Pakistan Ltd, TPL Properties, and Fauji Cement.

Turnover in the future contracts decreased to 105.84 million shares from 116.14 million shares.