Stocks rally on SBP status quo, inflows bets

Stocks on Tuesday recovered almost all the gains lost a day earlier as central bank’s move to hold the policy rate and reports of inflows from IMF and other bilateral lenders set off a sweeping rally, traders said.

The Pakistan Stock Exchange's (PSX) benchmark KSE-100 Shares Index gained 540.11 points or 1.26 percent to reach at 43,366.77 points after going as high as 43,418.37 and as low as 42,826.66 points during the day trade.

Ahsan Mehanti at Arif Habib Corp, attributed the rebound to the central bank’s neutral monetary policy statement and expectations of $2 billion bilateral support from Qatar, $1 billion oil financing from Saudi Arabia, and $1 billion investment from UAE to support the present financial crunch.

Strong financial results in the energy sector and SBP’s hint over the $1.2 billion IMF tranche due next month and expected over-financing for FY2023 contributed to a bullish close, Mehanti said.

Arif Habib Ltd said the index traded in the green zone throughout the day as investors cheered the policy rate status quo.

The cement sector remained in the limelight, the brokerage reported and added that hefty volumes were w itnessed in the main board and 3rd-tier stocks.

Sectors contributing to the performance included fertilisers (+124.8 points), cement (+121.7 points), E&Ps (72.2 points), technology (+62.2 points), and banks (+43.9 points).

The KSE-30 index also soared 258.58 points or 1.59 percent to 16,490.83 points.

Traded shares rose by 130 million shares to 324.443 million shares from 194.667 million shares.

The trading value increased to Rs9.655 billion from Rs5.331 billion. Market capital expanded to Rs7.211 trillion from Rs7.134 trillion.

Out of 341 companies active in the session, 211 closed in the green, 107 in the red, while 23 remained unchanged.

Topline Securities said the trade started with a positive gap as SBP rate hold bolstered investor sentiment, leading the market to make an intraday high of 592 points ahead of IMF’s 7th and 8th review under EFF facility on August 29, 2022.

LUCK, FFC, SYS, EFERT, and ENGRO were the major gainers in the trading session cumulatively, adding 240 points to the index.

The highest increase was recorded in shares of Nestle Pakistan, which rose by Rs242 to Rs6,197 per share, followed by Colgate Palm, up Rs64.99 to Rs2,400 per share. The losses were posted by Pakistan Services, which fell by Rs95 to Rs1,175 per share, followed by Sanofi-Aventis, down Rs70 to Rs1,270 per share.

Hascol Petrol led volumes with 64.117 million shares.

The stock went up by 35 paisas to Rs6.94 per share. It was followed by K-Electric Ltd with 25.229 million shares. The power utility closed higher by 5 paisas to Rs3.40 per share.

Other major volume-makers included WorldCall Telecom, Pakistan Refinery, Cnergyico PK, Bank Al-Falah XD, Telecard Limited, TRG Pak Ltd, TPL Properties and Nishat ChunPow.

Shares’ turnover in the future contracts increased to 138.107 million shares from 111.521 million shares.