KARACHI: Contrary to the dominant bearish trend during the week, the benchmark KSE-100 index skyrocketed over 1,000 points on the last day of trading week, surpassing the 43,000-point mark.
The positive performance came on the back of fading cloud of political uncertainty as investors were optimistic about the Senate chairman election.
According to the election results, announced after the trading session, incumbent Senate Chairman Sadiq Sanjrani was re-elected to the chair of the upper house, defeating Pakistan Democratic Movement (PDM) candidate Yousuf Raza Gilani.
In addition to that, the flow of workers’ remittances into Pakistan remained strong above $2 billion for the ninth successive month in February 2021. According to data released by the State Bank of Pakistan, the country received remittances worth $2.26 billion in February, which was 24% higher than $1.82 billion in the same month of previous year.
“In line with expectations, the market performed well,” said BMA Capital Executive Director Saad Hashmi while talking to The Express Tribune. “Looking back at the history of Pakistan Stock Exchange, it has been observed that whenever the market declines nearly 2,000-3,000 points, it bounces back,” he added.
Pak-Kuwait Investment Company Head of Research Samiullah Tariq told The Express Tribune that the market performed well on the back of diminishing political uncertainty.
Shedding light on the impact of third wave of coronavirus on Pakistan, Tariq said, “Despite the news of third wave, the market still performed better because so far there were no hints of a lockdown.”
“If the government decides to impose lockdown, the news will impact the market negatively; however, chances of lockdown are extremely low.”
Earlier, trading kicked off with a spike and the uptrend continued for most of the day. Towards the end, the market wiped off some of the gains as voting for the Senate chairman slot began. Still, the market managed to close in the green.
At close, the benchmark KSE-100 index recorded an increase of 1,008.32 points, or 2.36%, to settle at 43,788.08 points.
Arif Habib Limited, in its report, stated that post-clearance of leveraged positions of individual investors, the market bounced back with a jump of 1,206 points during the session and closed with a net increase of 1,008 points.
Cement and steel-sector stocks contributed significantly to the surge in the KSE-100 index, the report added.
“Technology stocks, which were the subject of leveraged positions, bounced back from the session’s low, however, by the end of trading selling resumed in tech stocks, which brought the index down from the session’s high.”
Besides, excitement about Senate elections also had some impact on the stock market, where a win on the government’s part was considered to be a source of confidence for the investors.
Sectors contributing to the performance included cement (+223 points), banks (+151 points), exploration and production (+90 points), power (+83 points) and oil and gas marketing companies (+70 points).
Individually, stocks that contributed positively to the index included Lucky Cement (+76 points), Hubco (+61 points), HBL (+46 points), Pakistan State Oil (+43 points) and Systems Limited (+43 points).
Stocks that contributed negatively were Azgard Nine (-9 points), Engro Corporation (-6 points), TRG Pakistan (-4 points), Abbott Laboratories (-2 points) and Shifa International Hospitals (-2 points).
Overall trading volumes rose to 442.6 million shares compared with Thursday’s tally of 406.1 million. The value of shares traded during the day was Rs21.6 billion.
Shares of 412 companies were traded. At the end of the day, 321 stocks closed higher, 74 declined and 17 remained unchanged.
Unity Foods was the volume leader with 88.3 million shares, gaining Rs1.27 to close at Rs26.56. It was followed by TRG Pakistan with 38.8 million shares, losing Rs0.34 to close at Rs119.99 and Jahangir Siddiqui and Company with 17.7 million shares, losing Rs1.42 to close at Rs18.98.
Foreign institutional investors were net sellers of Rs341.8 million worth of shares during the trading session, according to data compiled by the National Clearing Company of Pakistan.