Stocks recover 200 points amid low valuations
KARACHI: Stocks staged partial recovery on Tuesday after the massive erosion a day earlier. The KSE-100 index gained 200.47 points (0.53 per cent) and closed at 38,329.13.
Besides the attractive valuations that lured investors, some positive developments also helped lift sentiments. Traders said that after several days, the positive news flow brought a bit of cheer to the market.
The receipt of $2.2 billion from China resulted in raising the foreign exchange reserves to a double-digit level after eight months at $17.58bn.
Moreover, the arrival of International Monetary Fund mission dispelled the looming uncertainties as the government declared that a bailout package was expected in four to six weeks which could form the base for next year’s budget.
Investors also expected the decline in political temperatures following the Supreme Court decision to grant bail to the former prime minister Nawaz Sharif for six weeks on medical grounds. The market hoped that the government’s focus would shift to key economic issues.
After an initial slide of 89 points, the market turned positive and investors took fresh positions in cement, fertiliser, auto and exploration and production sectors. The last one contributed the highest of 101 points to the Index as investors began to put faith in prime minister’s prognosis of a possible discovery of immense offshore oil and gas reserves.
The volume soared 53 pc over earlier day to 86.1 million shares while average traded value also jumped by 33pc to reach $25.2m. Stocks that dominated the leaders’ list included Worldcall Telecom, K-Electric, Oil and Gas Development Company (OGDC), Fauji Cement and TRG Pakistan, which formed 38pc of total volume.
Major contribution to the index upside came from OGDC, up 2.73pc, Pakistan Petroleum 1.39pc, Mari Petroleum 1.88pc, Sui Northern Gas Pipelines 2.62pc and Searle Company 2pc, cumulatively adding 115 points. On the flip side, Fauji Cement, down 2.48pc, Pakistan State Oil 0.85pc and Saif Power 4.62pc took away 19 points.
Published in Dawn, March 27th, 2019