RECORDER REPORT
KARACHI: The sentiment-driven equity market rose to six-week high Friday after investors reacted to reports of Chinese President Xi’s long-awaited arrival to Pakistan on Monday.
The all important tour of President Xi Jinping is believed to have a huge economic significance as the two countries are expected to sign multiple bilateral agreements worth $ 46 billion.
The KSE-100 index gained 498.29 points or 1.52 percent to climb to 33,234.73 points level after six weeks. The trading turnover broke what Ahsan Mehanti of Arif Habib Corp said the previous record to grow beyond 400 million shares.
The volumes traded, analyst Samar Iqbal said, was not seen since December 3 last year. From Thursday’s Rs 16.5 billion, the traded value skyrocketed to Rs 19.23 billion that market observer said was 10-week high. Of the total 381 scrips traded, 237 made gains, 116 fell while 28 remained unchanged.
The market capitalisation rose to Rs 7.236 trillion compared to Rs 7.156 trillion of the previous trading session.
Before it rallied, the benchmark index initially moved southward to touch the session low 32,706.21 points.
The day’s bull-run was across-the-board and that also reflected on the foreign portfolio investors whose net buying accumulated to $ 11.99 million.
“Bullish activity was witnessed at KSE amid record trades led by cement and power stocks,” viewed Mehanti. This, he said, was on the back of speculations ahead of the Chinese president’s visit.
“Chinese president’s visit signals expectations of colossal influx of resources in Pakistan’s cement and textile sectors, with the already impending interest rate cuts,” said Ahmed Saeed Khan at JS Global.
The top scrips rallied in anticipation were FCCL, GATM, KTML and LPCL, the former two gaining five percent each and the latter two 3.1 and 4.5 percent, respectively.
The long-awaited visit of the Chinese president brought across the board buying at the local bourse, said Samar, adding that “euphoria was seen in cement stocks as investors believe that major developments project would be signed between Pakistan, China.”
Supported by increasing international crude oil prices, the index heavyweight oil and gas sector was also impressive with OGDC, PPL and ATRL closing 2.5, 3.8 and 4.8 higher.
The MCB and UBL added 4.4 and 2 percent as impressive March results of HMB and SNBL set high hopes of better earnings for other banks.
The recently sold-off HBL settled in the red zone by losing 1.4 percent, however. “Investors received their shares of secondary offering and wanted to cash out the profit,” opined Samar.
Devaluing to Rs 7.93, K-Electric led volumes with 57 million shares. Others to follow were TRG Pakistan 33 million, Fauji Cement 30 million, Jahangir Siddiqui Company 18.3 million, Japan Power 17.4 million, Southern Electric 16 million, Pak Elektron 15 million, Bank of Punjab 14 million, Maple Leaf Cement 12 million and Pakistan International Bulk Terminal 11 million shares.
Futures trade also climbed to 44.5 million contracts from the previous 43 million.
Khan said rumors surfacing during the day that Engro Corp, which gained 3 percent, was planning to enlist its newly-built LNG terminal at the bourse by the end of 1st quarter.
Other catalysts, Mehanti said, were the Supreme Court decision against the government’s review petition of GIDC levy, Moody’s statement on HBL sell-off and surge in global crude oil prices.
“Moving forward, we expect the bull-run to continue as expectations are high from the Chinese president’s visit,” said analysts.
