The benchmark KSE 100-share Index continued its upward rally and rose above 40,000 points level, its new all-time high, in the week ended August 12, 2016. The joys were short lived as the market closed slightly lower at 39,908 points, but the local bourse still witnessed a much-anticipated power play during the week.
The rally can be attributed to the rise in crude oil prices and the news of a surge in domestic cement sales, up 12.38, due to high demand from large government-funded infrastructure projects.
Banking, cement and oil exploration and production sectors, the index heavyweights, were the movers and shakers of the week. The KSE‐100 Index closed up 491.09 points or 1.25 per cent week-on-week; though market participation saw a decline of 141 million shares compared to 185 million shares in the previous week.
Despite a bearish trend in global markets, the week started off with thin participation in the local bourse. Investors remained wary because of the announcement of multiple rallies in Islamabad and Lahore by the Pakistan Tehreek-e-Insaf. Recovery in global markets on the back of 2.7 per cent gain in crude oil prices was also partially responsible for the slow movement in the first two days.
By the mid of the week, the market started gaining momentum due to news of increase in cement sales and Shanghai Electric and Engro Corp’s $2.8 billion bid for acquiring 66.4 per cent stakes in Karachi Electric, which currently rest with Abraaj Group and Al‐Jomaih Group. Engro denied the report later, but that did not stop investors from filling their coffers with shares of the country’s largest electricity provider.
The benchmark KSE 100-share Index breached its all-time high during intraday trade reaching 40,083 points before shedding 175 points. In line with Asian equities, the index rallied on the back of whopping gains in crude oil prices on Friday.
Amongst the major sectors, oil & gas exploration, commercial banks and pharmaceuticals were up 3.7 per cent, 2.6 per cent and 2.2 per cent, respectively. On the contrary, tobacco and power generation & distribution sectors were down, 5.5 per cent, and 0.4 per cent, respectively. Top-tier banks United Bank Limited and Habib Bank Limited contributed 144 points and 88 points, while E&P sector, particularly Pakistan Petroleum Limited, Oil and Gas Development Company and Pakistan Oilfields Limited, added 70 points, 50 points and 43 points, respectively, aiding the ascent of the benchmark index during the week.
Foreigners were net sellers of $1 million worth of shares. Oil & gas sector on the other hand witnessed net buying of $2.1million while cement sector witnessed net outflow of $1.8 million.
Volume leaders on the basis of average daily traded shares were Karachi Electric with 239 million shares, Deewan Salman Fibre Limited with 95 million shares, Deewan Cement Limited with 63 million shares and National Investment Bank with 37 million shares.Average daily volumes witnessed an 18 per cent increase; with volumes clocking in at 265.1 million shares traded per day. On the other hand, average daily values climbed 5 per cent to Rs11.4 billion ($109.3 million). The Pakistan Stock Exchange’s market capitalisation stood at Rs8 trillion ($76 billion) at the end of the week.