Trading at the Pakistan Stock Exchange (PSX) was volatile on Thursday with the benchmark index initially rising over 400 points but then erasing most of the gains by the day’s end.

The benchmark KSE-100 index dipped immediately after trading began, falling to an intraday low of 40,668.95 points, down 89.25 points or 0.22 per cent around 9:30am. However, it started recovering sharply afterwards and reached an intraday high of 41,219.67 points, up 467.41 points, or 1.13pc, around 2:15pm.

Two analysts attributed the rise to interest in energy and cement stocks.

Head of Equity at Intermarket Securities Raza Jafri said energy stocks continued to see interest as the government worked on its plan to resolve circular debt. He added that the cement sector was also lifting the index up on reports that a preferential trade agreement may be signed with Afghanistan which would reduce the price of Afghan coal.

First National Equities Limited Director Amir Shehzad also said the cement sector was behind the rally, which could sustain if the central bank’s Monetary Policy Committee decided to maintain the interest rate at its Jan 23 meeting.

Shehzad also attributed the positive sentiment to Prime Minister Shehbaz Sharif’s visit to the United Arab Emirates, saying the market expected positive outcomes.

Meanwhile, former PSX director Zafar Moti said the KSE-100 had risen because of several reasons, including Finance Minister Ishaq Dar’s clarification yesterday that the government would not take over commercial banks’ dollars. This had eased the panic created in the market earlier, he said.

Besides this, the market had also “taken a sigh of relief” after Chaudhry Parvez Elahi won the vote of confidence in the Punjab Assembly as it eased political uncertainty.

However, the index started falling again later in the day and closed at 40,803.89 points, up only 45.69 points, or 0.11pc.

Arif Habib Corporation’s Ahsan Mehanti said gains were limited because of profit-taking in the energy sector and a market sell-off.