Strong corporate results send PSX to record highs

Strong corporate results send PSX to record highs

The Pakistan Stock Exchange (PSX) on Monday rose to a new record high during the corporate earnings announcement season, driven by strong financial results and expectations ahead of the State Bank of Pakistan’s (SBP) monetary policy announcement on April 29.

In the morning, trading started at the lowest level of the day at 70,882.44 points, but soon the KSE-100 index recovered and moved higher. The positive momentum was fueled by the government’s talks on privatization of state-owned enterprises (SOEs), rupee stability amid foreign fund inflows and upcoming talks with the International Monetary Fund (IMF) for a new loan package.

As a result, the market crossed the barrier of 71,000 points and reached an intraday high of 71,861.18. Mainly, the oil and gas exploration, banking, fertilizer and cement sectors drove the index higher. It closed the day nearing its peak with a big profit. “Stocks closed higher in an earnings season rally amid strong financial results and speculation ahead of the SBP policy announcement on April 29,” said Ahsan Mehanti, MD of Arif Habib Corp.

“Government discussions on SOE privatization, rupee stability amid foreign inflows and IMF loan talks scheduled for next month played a catalytic role in the record close on the PSX.”

At the close, the benchmark KSE-100 index recorded a gain of 523.56 points, or 0.74%, to close at 71,433.46. Topline Securities, in its report, stated that the trading session in the Pakistani stock market ended on a high note as the KSE-100 index surged to a high of 71,433, marking an increase of 0.74%, or 524 points.

“Driving the upward movement are key sectors such as oil and gas exploration, banking, fertilizers and cement,” he said.

Mari Petroleum, United Bank, Engro Fertilisers, Lucky Cement and the Oil and Gas Development Company collectively contributed 351 points to the index. On the other hand, Hub Power, Bank AL Habib and Engro Polymer and Chemicals had a negative impact, dropping 57 points, Topline added.

Arif Habib Limited (AHL) wrote that there are “more gains for Pakistan with the KSE-100 crossing 71,000.”

A total of 63 stocks rose while 33 fell on the KSE-100 index. Mari Petroleum (+5.09%), United Bank (+2.6%) and Engro Fertilizers (+2.52%) were the biggest contributors to the index’s gains while Hub Power (-0.58%), Bank AL Habib (-0.82%) and Engro Polimer and Chemicals (-4.6%) was the main drag.

The news flow was dominated by the visit of Iranian President Ebrahim Raesi which, according to Prime Minister Shehbaz Sharif, was “very productive” as the leaders agreed to improve bilateral relations and increase trade volume to $10 billion, AHL added.

JS Global analyst Muhammad Shuja Qureshi said the positive momentum continued on the PSX where the KSE-100 gained 524 points to close at 71,433.

“The rally was broad-based where only the refining sector closed in the red. Bulls maintained their hold on the auto sector where Dewan Farooque Motors, Honda Atlas Cars and Sazgar Engineering closed in their respective upper locks,” he said, adding that the cement, steel and technology sectors saw renewed investor interest. “Investors are advised to book profits on the higher side and wait for a decline for any fresh buying,” the analyst added.

Total trading volume increased to 655.2 million shares compared to Friday’s total of 475.8 million. The value of shares traded during the day was Rs31.2 billion.

Shares of 389 companies were traded. Of these, 217 stocks closed higher, 140 fell and 32 remained unchanged.

Habib Bank was the volume leader with trade in 48.1 million shares, losing Rs0.55 to close at Rs114.53. It was followed by Pakistan Refinery with 30.5 million shares, losing Rs1.39 to close at Rs28.70 and Pak Elektron with 28.6 million shares, gaining Rs0.99 to close at Rs23.43. Foreign investors were net buyers of shares worth Rs332.6 million, according to NCCPL.