KARACHI: The stock market shrugged off political and security concerns and resumed its record-setting journey after a day of pause. It staged the sixth biggest single-day rally, propelling the KSE 100 index to the highest-ever level above 97,000 for the first time on Thursday.

Initially, the index came under selling pressure and lost 246.24 points to a low of 95,300.21. However, investors indul­ged in aggressive value-hunting, adding 1,890.70 points to 97,437.15 intraday. Finally, it settled at 97,328.40 after a gain of 1,781.94 points day-on-day.

Ahsan Mehanti of Arif Habib Corporation told Dawn that the speculation about a likely PTI-government patch-up for the Nov 24 protest and positive confidence buildup talk of the business community with the army chief fuelled investor optimism about the economic outlook.

In the face of the overnight gloomy conditions, particularly the deteriorating law and order situation and planned protests by the opposition party across the country, a spectacular rally seemed surprising.

The red flags raised by the IMF mission in its informal assessment of the economy on revenue shortfalls, a $2.5bn external financing gap, debt rollovers, unsuccessful privatisation of state-owned enterprises, the likelihood of a mini-budget, etc., still need to be solved. However, many analysts approached by Dawn skipped to comment on these aspects.

Mr Mehanti said robust economic data for current account surplus, remittances, exports and FDI, surging foreign exchange reserves and speculations over government decisions on economic reforms and privatisation contributed to the bull run at PSX.

Topline Securities Ltd said the market demonstrated a bullish trajectory as the army chief’s meeting with the business community boosted investor confidence. Aggressive buying in the fertiliser sector, particularly in Fauji Fertiliser and Fauji Fertiliser Bin Qasim Ltd (FFBL), contributed to the positive momentum.

Ali Najib, head of sales at Insight Securities, told Dawn that a drawdown in bond yields has compelled capital market investors to shift their funds into PSX to earn handsome gains.

He added that exchange rate stability and aggressive easing monetary policy encouraged investors to go for cherry-picking at attractive valuations.

Key contributors to the index’s upward movement included Fauji Fertiliser, Engro Fertiliser, Engro Corporation, FFBL, and Oil and Gas Development Company, which collectively added 1,196 points.

However, the overall trading volume fell by 14.8pc to 969.90 million shares. The traded value also contracted 6.10pc to Rs35.16bn on a day-on-day basis.

Stocks contributing significantly to the traded volume included World­Call Telecom (95.56m shares), Pace Pakistan (51.49m shares), Kohinoor Spinning (48.26m shares), K-Electric (44.58m shares) and Treet Battery (42.84m shares).

The shares registering the most significant increa­ses in their share prices in absolute terms were Pak­istan Services (Rs80.17), Haleon Pakistan (Rs80.13), PIA Holding Company [B] (Rs79.59), Archroma Pak­istan (Rs38.55) and Abbott Laboratories (Rs36.60).

The companies registering significant decreases in their share prices in absolute terms were Rafhan Maize (Rs137.27), Nestle Pakistan (Rs74.86), Mehmood Textile (Rs36.80), Reliance Cotton (Rs20.76) and Hafiz Ltd (Rs20.73).

Foreign investors remained net sellers as they offloaded shares worth $3.66m. However, mutual funds continued buying spree, picking shares worth $2.48m.

Published in Dawn, November 22th, 2024