KARACHI: Stocks extended the winning streak to the fourth consecutive day with the KSE-100 index taking another leap forward by 203.43 points (0.60 per cent) to settle at 34,008.33, knocking down the psychological barrier of 34,000.

Investors’ enthusiasm was underpinned by encouraging speculation of a cut in policy rate by 50-100 basis points. Most analysts expected the central bank to go for the higher cut in its announcement to come later in the day. Other than that, sentiments were boosted by hopes of foreigners’ return on attractive valuations of Pakistan stocks.

Trading started on a positive note with the index gaining 89 points on early buying in pharmaceutical and cement that carried the index to intraday high by 236 points. The ongoing recovery in international crude prices helped oil and gas stocks to recover some of the past losses. Oil and Gas Development Company and Pakistan Petroleum were major gainers in the sector.

Cement stocks, particularly the heavily leveraged, managed to rise on the anticipation of interest rate decline. DG Khan, Cherat, Pioneer, Kohat and Lucky posted gains. In pharma, Ferozsons Labs hit another upper circuit as news of its arrangement with Gilead for manufacturing of Remdesivir (along with four other firms in the two countries) made headlines also across the border.

Banking scrips remained subdued on the grim prospects of rate cut. However, Habib regained value it had lost prior to the results announcement of MSCI semi-annual review.

The volume declined 11pc to 213.3 million shares from 240.2m while traded value was up by just 1pc to reach $38.8m. Stocks that contributed significantly included Hascol Petroleum, K-Electric, Maple Leaf, Fauji Fertiliser and First Capital, which formed 25pc of total turnover.

Sectors contributing to the performance included exploration and production, higher by 109 points, power 58 points, cement 50 points, food 31 points and fertilisers 20 points. Buying was seen in big-cap stocks including Hub Power, up 3.3pc, Mari Petroleum 4.8pc, Pakistan Oilfields 3.3pc, OGDC 1.7pc, PPL 1.6pc and Lucky Cement 1.5pc.

Published in Dawn, May 16th, 2020