Banking and oil stocks were the major drivers as Pakistan equities moved northward to increase 3.6 percent during the week that ended on Friday, May 6. Benchmark KSE-100 index settled at 35,974 points amid heavy trading activity led primarily by investors' positive reaction to Pakistan's "highly likely" up-gradation as Morgan Stanley Composite Index (MSCI) to emerging market (EM) from the frontier one on May 14.
This kept luring in foreign investors who bought net portfolios of $21.2 million, mainly in cement sector.
The number of shares daily traded averaged one percent lower on 239.9 million the value of which appreciated eight percent to Rs 12.7 billion or $121.4 million.
Construction and material, industrial metals and mining and fixed line telecommunication were the most traded scrips, registering 5.6-6.4 percent growth. Major losers were life insurance and tobacco issues falling 1.2 percent.
"Heavy activity was seen at the local bourse this week as investors reacted positively to Pakistan's potential reclassification into MSCI Emerging Market Index," viewed analysts at Topline Research.
The index's weekly gains, they said, were mainly led by index heavyweight banking and oil exploration stocks.
Syed Atif Zafar of JS Research said the market carried forward the positive momentum build late last week on better-than-expected corporate results. The market, he said, appeared largely to have ignored the Finance Minister's announcement of extending Super Tax for another year.
Heavyweight oil and gas and banking sectors closed up as rising international crude oil prices not just improved the profitability outlook of the oil firms but also poured water on hopes of further cuts in the interest rates.
"Note that Ministry of Finance rejected all bids in the MTB auction held on Wednesday as cut-off yields were higher-than-expectations," Zafar opined.
The announcement of corporate results also was a trigger for healthy trade at the bourse, he added.
Other key highlights of the week were: IMF saying Pakistan can do it alone once the program ends, China willing to give $4.1 billion loan to Pakistan under China-Pakistan Economic Corridor for construction of road projects, Obama administration asking Congress to approve $742 million for Pakistan, Moody's saying Pakistan B3 issuer rating balances strengthening growth and progress on structural reforms, PTA looking to auction 3G/4G license for $395 million and FBR officials confirming reduction in corporate tax rate by one percent in the upcoming budget.