KARACHI:
Pakistan Stock Exchange (PSX) on Wednesday extended its bullish momentum as the KSE-100 index gained over 250 points because of stronger-than-expected corporate earnings, which helped restore investor confidence and encouraged buying across various sectors.
In the morning, trading opened on a positive note and the index gradually ascended to the intra-day high of 114,030 points around midday. Investors reacted to encouraging developments, including the surge in foreign direct investment (FDI) to $1.52 billion, up 56% in July-January 2024-25.
Additionally, the Saudi facility for oil supply on deferred payments was expected to stabilise the rupee and further boost market sentiment. Strong export data also played a pivotal role in driving up the market.
The bourse also saw heavy selling in the afternoon, which wiped out all the earlier gains and took the index down to the intra-day low of 113,060. However, it quickly recovered and closed in the green.
Ahsan Mehanti of Arif Habib Corp commented that stocks closed bullish in the earnings season rally as investors weighed upbeat data showing $1.52 billion worth of FDI for July-January FY25, up 56% and the renewal of Saudi oil credit facility for a year, which was likely to stabilise the rupee.
“Government’s deliberations on privatisation of state units, the World Bank’s pledge of $40 billion investment, higher crude oil prices and robust export data played a pivotal role in bullish close at the PSX,” he added.
At the end of trading, the benchmark KSE-100 index registered an increase of 253.96 points, or 0.22%, and settled at 113,342.44.
In its review, Topline Securities stated that the bourse maintained its bullish trajectory from the previous session as investor sentiment remained upbeat, driven by robust corporate earnings. The benchmark index surged 941 points intra-day before closing at 113,342, marking a 254-point gain.
The positive momentum was primarily fuelled by better-than-expected corporate results, which bolstered investor confidence and encouraged fresh buying across multiple sectors, it said.
Arif Habib Limited (AHL) reported “our weekly objective of 113.5k was achieved, with the high-on-day at 114k”.
Some 66 shares rose while 28 fell with Fauji Fertiliser (+1.18%), Bank AL Habib (+2.84%) and Millat Tractors (+4.31%) being the major contributors to index gains. In contrast, United Bank (-4.65%), Lucky Cement (-3.94%) and Hub Power (-1.42%) were the biggest index drags, AHL said.
It was a heavy day for company earnings, where United Bank posted CY24 earnings per share (EPS) of Rs61.12 (+36% year-on-year) and dividend per share of Rs44, Habib Bank (-1.49%) reported CY24 EPS of Rs39.85 (+1% YoY) and dividend per share of Rs16.25 and DG Khan Cement (+1.61%) declared 1HFY25 EPS of Rs8.42 (+244% YoY).
AHL added that the finance ministry had planned to reduce the tax on banks to 42% in the 2027 tax year. JS Global analyst Muhammad Hasan Ather noted that the index’s performance was driven by strong foreign investment commitments and expectations of further monetary easing by the State Bank.
Investor confidence was bolstered by the World Bank’s $40 billion investment pledge and robust performances in banking, cement, fertiliser and energy sectors, he said.
Overall trading volumes rose to 667.7 million shares compared with Tuesday’s tally of 545 million. Shares of 451 companies were traded. Of these, 236 stocks closed higher, 146 fell and 69 remained unchanged.
K-Electric was the volume leader with trading in 180.9 million shares, rising Rs0.65 to close at Rs4.88. It was followed by The Bank of Punjab with 53.8 million shares, falling Rs0.29 to close at Rs12.94 and Fauji Cement with 38.1 million shares, gaining Rs1.84 to close at Rs40.55. During the day, foreign investors sold shares worth Rs454.3 million, the NCCPL reported.
