PSX witnesses bullish trend: BRIndex100 gains 131.81 points

KARACHI: Pakistan Stock Exchange witnessed bullish trend during the outgoing week ended on January 08, on the back of healthy buying by both local and foreign investors and institutions.

BRIndex100 gained 131.81 points on week-on-week basis to close at 4,829.46 points. Average daily trading volumes stood at 584.105 million shares.

BRIndex30 increased by 261.76 points during this week to close at 24,170.94 points with average daily turnover of 434.978 million shares.

KSE-100 index surged by 1,219.54 points or 2.74 percent on week-on-week basis and closed well above 45,000 psychological level at 45,654.34 points.

Trading activities also improved during this week as average daily volumes on ready counter increased by 18.2 percent to 625.12 million shares as compared to previous week’s average of 528.68 million shares. Average daily trading value increased by 8.1 percent to Rs 153.29 billion.

The foreign investors emerged net buyers of shares worth $3.4 million during the week as compared to a net sell of $46.22 million last week. Buying was witnessed in Commercial Banks ($3.64 million) and Technology ($2.0 million). On the domestic front, major selling was reported by Insurance Companies ($8.1 million and Banks / DFIs ($8.1 million). Total market capitalization increased by Rs 179 billion to Rs 8.311 trillion.

“With the joy of a new year following through to the trading floor for the first week of the year and the January effect in full steam (where investors re-allocate portfolios, driving volumes higher), the KSE-100 index retuned 2.7 percent on week-on-week basis to close at 45,654 points continuing the uptrend witnessed during the tail end of CY20”, an analyst at AKD Securities said.

Additional catalysts arose in the form of significant headway on circular debt resolution efforts initiated by the government in August 2020, while the surprise crude supply cut by Saudi Arabia lifted crude benchmarks and in turn bolstered the index heavy E&P space. Further support was witnessed in the form of strong investor participation in commercial banks, as supportive end of year result expectations drove bullish sentiments.

Stocks driving the market higher included FML (up 23.4 percent), KAPCO (up 21.3 percent), BYCO (up 17.9 percent) and MEBL (up 10.7 percent), whereas laggards acting as a drag were SHEL (down 25.3 percent), GATI (down 11.9 percent) and ANL (down 10.2 percent).

An analyst at Arif Habib Limited said that the KSE-100 Index started the new-year with renewed optimism, led by a bullish spree in IPP scrips, following the announcement of the plan for circular debt resolution. Moreover, oil prices saw a jump of 7.8 percent on WoW, as reports came in of Russia abstaining from pushing for an output hike in February. Expectations of a textile policy announcement plus circular debt resolution plan (benefit for holding companies) created optimism in textile scrips as well.

Banking scrips (large banks in particular) attracted interest as well given economic recovery in the country appears to be on track and loan growth outlook has improved considerably. The domestic equity bourse closed at 45,654 points, up 1,220 points on WoW.

Sector-wise positive contributions came from Banks (up 561 points), Fertilizers (up 224 points), Oil & Gas Exploration (up 153 points), Power Generation & Distribution declined (up 66 points) and Chemicals (up 47 points).

Scrip-wise positive contributions were led by UBL (up 154 points), HBL (up 117 points), MEBL (up 90 points), DAWH (up 88 points), and MCB (up 80 points).

Copyright Business Recorder, 2021