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Stocks rally as current account deficit shrinks

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KARACHI:

Bulls staged a comeback on the Pakistan Stock Exchange on Monday, as the benchmark KSE-100 index, after staying within the inexperienced zone all through the day, gained 200 factors and began the week on a optimistic word.

However, the buying and selling quantity and worth remained skinny primarily because of the prevailing scepticism on the home and worldwide fronts.

A shocking plunge in Pakistan’s current account deficit (CAD) to a sustainable stage of $545 million (an eight-month low) in February 2022 bolstered the boldness of market gamers, who made recent inventory purchases throughout the board.

Moreover, the decision of Reko Diq dispute additionally inspired the buyers to renew the cherry-picking of shares at engaging valuations.

Earlier, the buying and selling session started with a pointy incline as the benchmark index rose to round 43,357 factors within the preliminary hour. However, a quick promoting spree, because of the prevailing volatility on the home political entrance, quickly pulled the index all the way down to round 43,147 factors.

Moving ahead, the index registered minor fluctuations however remained within the inexperienced zone. It touched an intra-day excessive of 43,388 factors through the ultimate hours and managed to finish buying and selling within the optimistic zone.

At shut, the benchmark KSE-100 index recorded a rise of 200.25 factors, or 0.47%, to settle at 43,230.22 factors.

Topline Securities, in its report, stated that Pakistan equities commenced the week on an encouraging word on the again of reports concerning the decision of Reko Diq dispute coupled with better-than-expected CAD figures for February.

Fertiliser, cement and exploration and manufacturing sectors supported the KSE-100 index by including 150 factors cumulatively.

On the flip aspect, United Bank, Bank AL Habib and Habib Metropolitan Bank confronted some profit-taking as they misplaced 33 factors collectively, the report stated.

A report of Arif Habib Limited acknowledged that the benchmark index stayed within the inexperienced zone as CAD shrank 78% in February.

Moreover, the federal authorities and the provincial authorities of Balochistan signed a brand new settlement with Barrick Gold Corporation of Canada for the extraction of gold and copper reserves from Reko Diq with an funding of $10 billion, it identified.

In the exploration and manufacturing sector, Oil and Gas Development Company (OGDC) and Pakistan Petroleum Limited (PPL) had been within the limelight as the federal authorities’s 25% shareholding can be divided equally amongst three state-owned-entities – OGDC, PPL and Government Holdings (Private) Limited (GHPL).

“Main board activity remained dull. On the flip side, activity continued to remain sideways as the market witnessed hefty volumes in third-tier stocks,” the report stated.

Sectors contributing to the efficiency included fertiliser (+58.6 factors), cement (+37.8 factors), exploration and manufacturing (+24.4 factors), banks (+21 factors) and funding banks (+17.2 factors).

JS Global analyst Mubashir Anis Naviwala stated that bulls made a comeback as the market touched an intra-day excessive of 43,388 factors, nonetheless, it closed up by solely 200 factors at 43,230 factors.

Summit Bank (+23%), Hum Network (+3.8%), WorldCall Telecom (-2%), Treet Corporation (+1%) and Engro Fertilisers (+0.2%) cumulatively contributed 37% to the overall volumes.

“Going forward, we expect range-bound activity to continue in the coming sessions due to concerns over the economic outlook and geopolitical situation,” the analyst stated.

“We recommend investors to adopt a buy-on-dip strategy in banking, exploration and production and cement sectors.”

Overall buying and selling volumes dropped to 124.9 million shares in contrast with Friday’s tally of 180.4 million. The worth of shares traded through the day was Rs3.9 billion.

Shares of 317 firms had been traded. At the top of the day, 165 shares closed increased, 126 declined and 26 remained unchanged.

Summit Bank was the amount chief with 16.1 million shares, gaining Rs0.53 to shut at Rs2.86. It was adopted by Hum Network with 8.9 million shares, gaining Rs0.24 to shut at Rs6.53 and WorldCall Telecom with 7.97 million shares, dropping Rs0.03 to shut at Rs1.47.

Foreign institutional buyers had been web sellers of Rs45.1 million value of shares through the buying and selling session, based on information compiled by the National Clearing Company of Pakistan.



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