KARACHI: The Pakistan stock market managed to break the bear hug on Friday when the KSE-100 index traded in green right from the beginning. It oscillated between the intraday high and low by 798 and 226 points and closed with a recovery of 537.58 points (1.78 per cent) at 30,667.
Brokers and traders said that after unprecedented fall week after week, the shares had reached attractive valuations, which forced investors to buy throwing the fear of coronavirus to the winds. Other reasons that encouraged investors to go for value buying was the recovery in oil prices in the international markets.
Foreign selling of $6.67 million dragged the share values down. Insurance companies again absorbed much of the liquidity with net buying of $4.28m. Local corporates and individuals also accumulated blue chips.
The volume declined 21pc over the earlier day to 245m shares while traded value also decreased by 16pc to $53.4m. Stocks that contributed significantly included K-Electric, Maple Leaf Cement, Bank of Punjab, Fauji Cement and Unity Foods, which formed 34pc of the aggregate turnover.
Fertiliser, exploration and production and banking were the major sectors which attracted investors. All three key shares in E&P — Pakistan Petroleum, Pakistan Oilfields and Oil and Gas Development Company — were heavily traded and closed at their upper circuit. Banks also managed to rebound after days of plummeting. Habib, rising by 6.1pc, MCB 0.1pc, United 1.4pc, Al Habib 1.7pc and Alfalah 6.2pc closed higher than their previous closing.
Selling pressure was witnessed in cement where DG Khan, down 3.7pc, Maple Leaf 6.8pc, Cherat 7.5pc, Pioneer 7.5pc and Kohat 7.5pc closed in the red. The prices in the sector’s shares rolled back after a disappointing rate cut of just 75 basis points in the recently announced monetary policy statement against market consensus between 100 and 300bps that would have helped leveraged cement companies to reduce financial costs.
Published in Dawn, March 21st, 2020