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Stocks recover 475 points on value-hunting

KARACHI: Following the massive sell-off a day earlier, Pakistan equities staged a rebound on Tuesday with the KSE-100 index reclaiming 474.86 points (1.18 per cent) to close at 40,884.24.

Banks, individuals and insurance companies accumulated blue chips available at attractive valuations while foreigners pushed more holdings worth $3.93 million.

The market opened on a negative note and the index slipped to intraday low by 60 points after which the bears withdrew which offered the opportunity to investors to deploy cash that was hastily withdrawn on Monday by the sell-off.

The index remained in green for most of the session reaching the intraday high by 544 points. None of the factors were resolved that had triggered a blood bath a day earlier.

Higher-than-expected January inflation; uncertainty on the political front; consultations with International Monetary Fund over its third review; whispers of an upcoming mini-budget; steep decline in global crude prices and the scare of the Financial Action Task Force that would announce if Pakistan would be pulled out of the grey list, later this month kept risk averse investors cautious, but others threw caution to the wind in greed to collect value stocks, despite a day off on Wednesday due to public holiday.

The volume declined 28pc to 146m shares while traded value fell 33pc to $39.7pc. Stocks that contributed significantly included Bank of Punjab, Hascol Petroleum, Unity Foods, K-Electric and DG Khan Cement, which formed 38pc of total turnover.

Sector-wise, banks were major gainers as they contributed 217 points to the index recovery, followed by power sector 83 points, fertiliser 62 points, cement 44 points and oil and gas marketing companies 20 points.

Among scrips, recovery in MCB, higher by 4.6pc, Hub Power 3.3pc, Engro Corporation 2.1pc, United Bank 2.5pc, Ban Al Habib 2.4pc, Lucky Cement 2.2pc, Pakistan State Oil 1.5pc and Oil and Gas Development Company 0.6pc collectively added 327 points to the index upsurge.

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