KARACHI: Stocks continued to climb on Friday powered by the banking sector. The KSE-100 index added 309.80 points, or 0.68 per cent, to close the week at 45,654.
The market opened in the green and as the much undervalued banking sector’s shares garnered investor interest, the index touched intra-day high by 572 points.
Improvement in leading macro indicators such as growth in exports (the highest monthly number since Sept 2013) as well as consistent increase in the State Bank of Pakistan (SBP) foreign exchange reserves and the record rise of 16.2pc in remittances to $2.4 billion in December helped to put faith in the economy in the hearts of investors.
With growing participation of retail and day traders, the volume of shares that changed hands swelled to 696 million shares with a staggering number of 164m shares, or a quarter of the entire volume, transacted in Byco Petroleum, the stock on the refinery sector.
The tragic incident of Quetta and the ongoing protests in and various cities did not dent investor sentiments as they expected the issue to be resolved soon. On the political side, things remained quiet.
Foreign investors bought shares for the third day amounting to $0.32m. Mutual funds and brokers were major buyers of stocks worth $3.92m and 2.82m, respectively.
Banking sector, which had been the laggard for a long time, captured investor interest due to their attractive valuations, anticipation of substantial growth in deposits and hopes of declaration of dividends after being freed from the SBP ban, earlier imposed due to Covid-19 and need for retention.
All of that encouraged investors to buy stocks on several sectors including exploration & production where Pakistan Petroleum and Oil & Gas Development Company (OGDC) closed higher on further uptick in international oil prices.
On the textile, sector select stocks performed on the back of the awaited textile policy in the coming week. Scrip-wise, major contribution to the index gains came from banking stocks which included United Bank Ltd, MCB Bank Ltd, OGDC, Bank Al Habib Ltd and Habib Bank Ltd as they cumulatively contributed 167 points to the index.
Selling pressure mounted in the oil & gas marketing companies.
Published in Dawn, January 9th, 2021