Economic optimism fuels PSX rally

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Expectation of a cut in SBP’s policy rate and signs of economic recovery continue to garner investor interest in shares market.—Reuters/file
Expectation of a cut in SBP’s policy rate and signs of economic recovery continue to garner investor interest in shares market.—Reuters/file

KARACHI: The stock market maintained its bullish run in the outgoing week owing to a number of positive developments on the macroeconomic front.

Arif Habib Ltd said the KSE-100 index closed at another all-time high as the current account deficit for October amounted to $74 million, marking a significant decrease of 91 per cent on a year-on-year basis.

Furthermore, textile exports witnessed a 6pc annual growth after 13 months in October. Additionally, foreign exchange reserves of the State Bank of Pakistan decreased by $217m to hit $7.2 billion.

The rupee closed at 285.37 against the greenback in the outgoing week after appreciating by 0.39pc from a week ago.

As a result, the KSE-100 index closed at 59,086 points after increasing by 2,023 points or 3.5pc from a week ago.

Sector-wise, positive contributions came from commercial banking (960 points), fertiliser (247 points), technology and communication (182 points), glass and ceramics (89 points) and miscellaneous (89 points).

Meanwhile, sectors that contributed negatively were chemical (10 points), refinery (nine points), insurance (four points) and tobacco (two points).

Scrip-wise, positive contributors were Meezan Bank Ltd (221 points), Bank AL Habib Ltd (145 points), Systems Ltd (135 points), Fauji Fertiliser Company Ltd (114 points) and Mari Petroleum Company Ltd (99 points).

Meanwhile, negative contributions came from Oil and Gas Development Company Ltd (73 points), Rafhan Maize Products Company Ltd (25 points), Colgate-Palmolive Pakistan Ltd (23 points), Pakistan Petroleum Ltd (21 points) and Unity Foods Ltd (18 points).

Foreign buying continued in the outgoing week. It clocked in at $8.5m versus a net purchase of $6.3m a week ago. Major buying was witnessed in banks ($2.3m) and fertilisers ($1.8m).

On the local front, selling was reported by banks ($5m) and “other organisations” ($3.5m). The average daily volume arrived at 731m shares, down 4pc from a week ago. The average daily value traded settled at $74m, down 11pc on a weekly basis.

AKD Securities Ltd said it maintains its positive outlook on the stock market owing to favourable economic developments like improving inflation and expected positive economic recovery in the current fiscal year. “While the market is flourishing, we strongly advise market participants to avoid potential pitfalls and instead concentrate on companies with robust fundamentals,” it added.

Published in Dawn, November 26th, 2023

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