PSX rebounds after four days of decline

Pakistan Stock Exchange (PSX) on Tuesday staged a strong rebound, fuelled by a decade-low inflation rate and expectations of robust earnings announcements by major companies in banking, fertiliser and oil sectors.

During the day, the benchmark KSE-100 index surged to the intra-day high of 890 points and the intra-day low of 269 points. It ultimately settled higher by 757 points, or 0.68%. In the morning, the market commenced trading on a positive note but soon it started falling. The index’s downturn continued until before midday. Value hunting in the last few hours reignited investor confidence, contributing to the bullish performance.

Ahsan Mehanti of Arif Habib Corp commented that stocks recovered as investors weighed the inflation rate of 1.5% year-on-year for February 2025, a low for more than a decade. He noted that it would lead to a further easing of State Bank’s monetary policy.

Mehanti added that a strong earnings outlook for blue-chip banking, fertiliser and oil companies as well as government deliberations for the privatisation of state-owned enterprises played the role of catalysts in the bullish close at the PSX. At the end of trading, the benchmark KSE-100 index recorded an increase of 756.91 points, or 0.68%, and settled at 112,743.80.

In its market review, Topline Securities remarked that after enduring four consecutive bearish sessions, bulls made a strong comeback on Tuesday, driving the benchmark index to the intra-day high of 890 points and the intra-day low of 269 points. By the closing bell, the index settled at 112,744, gaining 757 points.

Investor sentiment improved significantly, fuelled by positive economic data. On the news front, the annual inflation continued its downward trajectory, reaching roughly a decade low of 1.5% year-on-year in February, it pointed out.

The market’s recovery was led by buying interest in key sectors as investors capitalised on recent dips. UBL, Mari Petroleum, Fauji Fertiliser Company, The Searle Company and Hub Power were among the top contributors, adding 400 points to the index.

Additionally, the pharmaceutical sector attracted strong investor interest, where Searle, BF Biosciences and Citi Pharma closed higher than their previous day’s levels, Topline added. Arif Habib Limited (AHL), in its report, noted that Tuesday’s recovery followed a string of consecutive lower closes.

Some 61 shares rose while 30 fell with UBL (+1.5%), Mari Petroleum (+2.2%) and The Searle Co (+10%) contributing the most to index gains. “We are looking at the market to continue to push higher for the remainder of the week towards 115k,” it said.

Ali Najib of Insight Securities observed that the PSX resumed trading on a subdued note. However, value hunting in the last couple of hours brought some excitement. Market sentiment suggested that fresh flows from stocks of banks, exploration & production, fertiliser, pharma and power sectors triggered value hunting, which ultimately saved the day for bulls, Najib said.

Overall trading volumes decreased to 206.9 million shares compared with Monday’s tally of 208.9 million.

Shares of 429 companies were traded. Of these, 221 stocks closed higher, 150 fell and 58 remained unchanged. The value of shares traded during the day was Rs11.3 billion.

WorldCall Telecom was the volume leader with trading in 12.6 million shares, falling Rs0.01 to close at Rs1.40. It was followed by Citi Pharma with 12.3 million shares, gaining Rs7.35 to close at Rs92.93 and Pakistan International Bulk Terminal with 10.3 million shares, falling Rs0.29 to close at Rs9.12.

During the day, foreign investors sold shares worth Rs189.9 million, the National Clearing Company of Pakistan reported.