Stocks end remarkable 2023 on a high: KSE-100 settles at 62,451 after 0.64% gain

Bulls ensured stocks closed 2023 on a high at the Pakistan Stock Exchange (PSX) as the benchmark KSE-100 Index ended the final trading session of the year in the green.

At close, the index settled at 62,451.04 level, an increase of 398.81 points or 0.64%, but not before it had swayed both ways during the session.

A mixed trend was seen at the bourse with index-heavy sectors including automobile assemblers, cement, oil and gas exploration companies and OMCs trading in the green, while commercial banks, and refinery sector ended in the red.

At close on Thursday, investors had continued their buying run as the benchmark index jumped nearly 2% to settle at 62,052.23 level, an increase of 1,188.61 points or 1.95%.

However, Friday was a slightly volatile session with a gain in the first half followed by selling pressure after the break.

In the final hour, however, buying spree ensured the KSE-100 – which registered a gain of nearly 55% in 2023 – ended on a high.

Experts said investors were seen value hunting on the year’s final day of trading. Meanwhile, sentiment was also upbeat on account of a significant increase in the country’s foreign exchange reserves.

State Bank of Pakistan (SBP) held foreign exchange reserves increased by $850 million for the week ending December 22, 2023.

“Many market participants were not expecting this before the International Monetary (IMF) tranche, which is likely next month,” said Mohammed Sohail, CEO Topline Securities, in a post on X.

“This will not only help stabilise PKR but will also help in achieving December end IMF targets,” he added.

In 2023, the KSE-100 index gained nearly 55% (USD return of nearly 24%).

“Interestingly, all the gains were seen in the second half of 2023 when the IMF approved a short-term program to support Pakistan,” said Sohail in a separate note.

In the last 6 months, Pakistan has remained the best market globally, said Sohail, citing Bloomberg data.

“Despite this recovery in 2023, the Pakistan market trades at a very low price to earning (PE) of 3.4x,” he said.

Sohail was of the view that upcoming elections and a new long-term IMF programme to manage external financing needs will remain key drivers of the market in 2024.

Globally, Asian stocks took a breather on the last trading day of the year and were set to snap their two-year losing streak with investors buoyed by the expectations that the Federal Reserve will start cutting interest rates next year.

Meanwhile, the Pakistani rupee maintained its momentum against the US dollar for the 13th successive session as it appreciated 0.02% in the inter-bank market on Friday.

Volume on the all-share index decreased to 590.6 million from 676.2 million a session before.

The value of shares declined to Rs16.8 billion from Rs20.2 billion in the previous session.

K-Electric Ltd was the volume leader with 141.8 million shares, followed by Fauji Foods Ltd with 28.3 million shares, and WorldCall Telecom at 27.9 million shares.

Shares of 359 companies were traded on Friday, of which 207 registered an increase, 130 recorded a fall, while 22 remained unchanged.