KARACHI: The stock market staged a rally on Wednesday that propelled the KSE-100 index by 435.05 points (1.46 per cent) to close at 30,244.73.
The major reason for the rejuvenation of investor interest was attributed by most market leaders to the lower Consumer Price Index (CPI) numbers for the month of August which clocked in at 10.50pc after revision in weights by Pakistan Bureau of Statistic. However, when calculated on the old base, the CPI for August stood at 11.60pc. The lower CPI numbers were thought to enable interest rate cuts.
In the early hours, the market saw almost distress selling in shares of banking sector which dragged the index down to the intra-day low by 342 points. The index managed to recoup all the losses in the late session peaking to intra-day high by 568 points.
Investors pushed aside the worries over the geo-political situation; the concerns on upcoming Financial Action Task Force review in Bangkok and poor economic situation.
The significant feature of day’s trading was the buying by ‘individuals’ who raked up stocks worth $4.24 million. While institutional participants and mutual funds generally remained on the side-lines, foreign investors sold equity of $4.57m.
Cement sector led the upsurge in index, which was supported by oil and gas marketing companies and exploration and production (E&P) sectors where the Oil and Gas Development Company (OGDC) and Pakistan Petroleum Ltd (PPL) also hit upper circuits.
Cement stocks which closed at or near their upper circuits included D. G. Khan Cement, Lucky Cement (LUCK), Maple Leaf Cement Factory (MLCF), Pioneer Cement and Kohat Cement. Value buying was witnessed in E&P sector leading to increase in scrip prices of PPL, OGDC, Pakistan Oilfields Ltd and Mari Petroleum.
Volumes doubled to 128.7m shares from 64m shares traded the previous day. Traded value also increased by 100pc day-on-day to reach $31.2m.
Stocks that contributed significantly to the volumes include MLCF, Fauji Cement Company Ltd, Unity Foods, WorldCall Telecom Ltd and Lotte Chemicals — which formed 35pc of total volumes.
Major heavyweights which lifted the index were Engro Corporation up 3.5pc, OGDC 3.8pc, PPL 4.2pc, LUCK 4.8pc and MCB Bank Ltd 2.7pc.
Published in Dawn, September 5th, 2019