Stocks pick up on Saudi package

Stocks on Wednesday snapped out of losing streak cheering Saudi Arabia’s nod to provide $4.2 billion worth of assistance to support the country’s hobbled economy, traders said.

Pakistan Stock Exchange's (PSX) benchmark KSE-100 Share Index gained 564.12 points or 1.25 percent to close at 45,791.92 points, testing a day high and low of 46,024.76 and 45,227.80 points.

Analyst Ahsan Mehanti at Arif Habib Corp said stocks showed sharp recovery on reports of Saudi government’s approving $3 billion financing and $1.2 billion deferred oil payment facility for budgetary support and Pak-IMF agreement over use of $2.78 billion Covid support fund ahead of the resumption of EFF (Extended Fund Facility).”

Strong financial results, major recovery in rupee parity, and higher global crude oil prices played a catalyst role in bullish close, Mehanti said.

KSE-30 index also jumped 234.82 points or 1.33 percent to 17,911.47 points.

Traded shares swelled by 18 million to 180.40 million shares from 162.79 million shares on Tuesday. Trading value increased to Rs7.13 billion from Rs5.61 billion. Market capital rose to Rs7.889 trillion from Rs7.817 trillion. Out of 333 companies active in the session, 245 posted gains, 76 losses while 12 remained unchanged.

Topline Securities in a post market report attributed the rally to improvement in sentiments owing to reports suggesting Saudi Arabia would deposit $3 billion cash in the State Bank of Pakistan (SBP) and also provide $1.2 billion worth of oil on deferred payments, which would further pave way for the resumption of the IMF (International Monetary Fund) programme.

However, the new trading system kept activity restricted and trading was also suspended at noon for two hours and 30 minutes in order to resolve technical issues. Volumes remained thin, while the KSE All Share index saw a total traded volume of 163mn shares.

Along with stocks rupee also bounced back on Wednesday to gain 2.48 rupees against dollar in intra-day trading, after announcement of Saudi support package. Analyst said Saudi cash would help Pakistan shore up its foreign reserves that had been shrinking.

The rupee closed the previous session at 175.60 against the dollar. It had depreciated around 13.6 percent since May.

The highest increase was recorded in the share value of Allawasaya Textiles, up Rs122 to settle at Rs2,019/share, followed by Philip Morris Pakistan, up Rs62.45 to close at Rs895.45/share.

Sapphire Textiles was the worst loser of the day as it fell Rs92.90 to Rs1,156/share, followed by Sapphire Fiber, down Rs50.50 to end at Rs634/share.

WorldCall Telecom led volumes chart with 11.83 million shares, trailed by Unity Foods Ltd with 11.01 million shares.

Stocks that recorded significant turnover included Hum Network, Byco Petroleum, Ghani Global Holdings, Telecard Limited, TRG Pakistan Ltd, Azgard Nine, Aisha Steel Mills, and Maple Leaf Cement.

Percentage-wise, the highest increase of price was recorded in stocks of MERITR2, PKGI, SLL, FFLM, CWSM, RICL, REDCO, DSML, RUBY, and QUET whereas, percentage-wise major laggards were ALAC, FIBLM, HIFA, OML, SAPT, LMSM, SFL, IDSM, IGIHL, and SCL. Turnover in the future contracts shrank to 118.99 million shares from 132.18 million.