Banking sector saves the day as profit-taking erases intra-day gains, KSE-100 closes below 98,000

A massive wave of profit-taking erased almost all intra-day gains at the Pakistan Stock Exchange (PSX) as the benchmark KSE-100 Index plummeted to the 97,500 level after hitting a high of 99,623.03 earlier in the session on Friday. A sea of red dominated the charts as investors chose to book profits, and it was only the banking sector that helped the benchmark close in the green.

Earlier, the KSE-100 crossed the 99,000 mark for the first time in history during intra-day trading.

Back then, buying was observed in key sectors including automobile assemblers, commercial banks, fertiliser, oil and gas exploration companies, OMCs and power generation. Index-heavy stocks including FFC, FFBQL, PSO, PPL and OGDC traded in the green before profit-booking began.

At close, the benchmark index settled at 97,798.23, up by 469.83 points or 0.48% as compared to the previous close.

All this, however, comes after the market had been on an upward trajectory in recent weeks amid optimism on account of positive macroeconomic indicators and projections of a further reduction in key policy rates.

“The buying spree comes on the back of institutional buying, as liquidity is shifting from fixed income to equities,” Sana Tawfik, Head of Research at Arif Habib Limited (AHL), told Business Recorder earlier.

Moreover, market anticipates a lower inflation reading for November, raising projections of a further rate cut.

“We are anticipating an inflation reading for November at 4.5-5%,” she added.

Meanwhile, Intermarket Securities Limited, in a note, said that the market was anticipating the government would try a new solution to settle the outstanding balance of circular debt of the E&Ps.

“The market is also not expecting much disruption from the Pakistan Tehreek-e-Insaf (PTI) protests planned to begin on 24 November. We think the positive momentum will continue, and the index will soon cross the 100,000 level,” it added.

However, a fresh wave of consolidation and profit-taking overcame investors who decided to book their gains ahead of the protest.

On Thursday, PSX had achieved a historic milestone and hit the then highest-ever level on the back of strong interest of local investors coupled with institutional support on optimism after cut in interest rate, decreasing inflation and improving macroeconomic indicators.

The benchmark KSE-100 Index crossed 97,000 and closed at its highest-ever closing of 97,328.40 points, recording an increase of 1,781.94 points or 1.87%.

Globally, most Asian markets gained Friday after a bounce on Wall Street, while bitcoin continued its march higher to move within touching distance of the $100,000 mark.

Rising geopolitical tensions tempered the atmosphere and pushed oil higher after Russia hit Ukraine with a new-generation intermediate-range missile and sent a warning to the West.

The gains in equities followed a retreat in most regional bourses Thursday after a forecast-topping earnings report from chip titan Nvidia still fell short of investors’ hopes and sparked worries that a tech-fuelled surge in markets may have run its course.

However, all three main indexes on Wall Street ended on a positive note with observers saying traders had dialled back their gloom over Nvidia as they digested pledges by the firm over production of its keenly anticipated Blackwell line-up.

Tokyo climbed 1% as the government prepares to announce a $140 billion stimulus package to kickstart the country’s stuttering economy, while Sydney, Seoul, Singapore, Wellington, Taipei and Jakarta also rose.

Meanwhile, the Pakistani rupee recorded a marginal gain against the US dollar, appreciating 0.07% in the inter-bank market on Friday. At close, the currency settled at 277.76, a gain of Re0.20 against the greenback.

Volume on the all-share index increased to 1,249.09 million from 969.91 million on Thursday.

The value of shares rose to Rs45.47 billion from Rs35.17 billion in the previous session.

WorldCall Telecom was the volume leader with 177.13 million shares, followed by K-Electric Ltd with 124.13 million shares, and Hascol Petrol with 105.01 million shares.

Shares of 449 companies were traded on Friday, of which 112 registered an increase, 296 recorded a fall, while 41 remained unchanged.