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534-point rally takes index to six-year high
KARACHI: Stock prices continued their upward movement on Wednesday as investors welcomed the slowdown in the annual pace of inflation, which clocked in at 28.3 per cent in July.
Arif Habib Corporation analyst Ahsan Mehanti said the status quo in the key interest rate by the State Bank of Pakistan announced on Monday also helped propel the benchmark of representative shares to its six-year high.
In addition, a trade deficit of $1.6bn for July, surging global crude oil prices and the government’s apparent resolve to address the gas sector’s circular debt also played the role of a catalyst in the bullish close.
“The momentum remains very strong in blue chips but be weary of sharp pullbacks that can emerge in the near term,” said the brokerage, noting that any movement below the 48,000-point level will be the first signal of a possible dip.
JS Global recommended that investors should adopt a buy-on-dips strategy to take positions in steel, technology, refinery and cement sectors.
As a result, the KSE-100 index settled at 48,764.55 points, up 534 points or 1.11pc from the preceding session.
The overall trading volume remained almost flat at 556.1 million shares. The traded value increased 25.3pc to Rs19.9bn on a day-on-day basis.
Stocks contributing significantly to the traded volume included Cnergyico PK Ltd (92.8m shares), the Bank of Punjab Ltd (46.9m shares), Pakistan Refinery Ltd (31.3m shares), Oil and Gas Development Company Ltd (28.3m shares) and Unity Foods Ltd (26.8m shares).
Companies registering the biggest increases in their share prices in absolute terms were Nestle Pakistan Ltd (Rs150), Sapphire Textile Mills Ltd (Rs39.88), Sanofi-Aventis Pakistan Ltd (Rs30), Sapphire Fibres Ltd (Rs26) and Reliance Cotton Spinning Mills Ltd (Rs20).
Companies that recorded the biggest declines in their share prices in absolute terms were Blessed Textiles Ltd (Rs27.74), Philip Morris Pakistan Ltd (Rs12.50), Siemens Pakistan Engineering Ltd (Rs10.45), the Thal Industries Pakistan Ltd (Rs7.25) and Colgate-Palmolive Pakistan Ltd (Rs6.17).
Foreign investors were net buyers as they purchased shares worth $0.54m.
Published in Dawn, August 3rd, 2023
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