Oil and gas stocks drive PSX surge

The Pakistan Stock Exchange’s (PSX) benchmark KSE-100 index gained nearly 600 points on Thursday morning, buoyed by buying in the oil and gas exploration sector.

The benchmark index was up 599.39 points, or 1.42 per cent, to reach 42,864.75 by 11:40am.

AKY Securities CEO Amin Yousuf said positive momentum was being witnessed in the market since morning, particularly on the back of trading in the oil sector.

He attributed this bullish trend to the upcoming visit of Saudi Crown Prince Muhammad bin Salman to Pakistan and the “expectation of $10 billion investment in a refinery”, which was announced by Prime Minister Shehbaz Sharif last month.

Additionally, he said, there was a possibility of some more pledges for financial assistance after Prime Minister Shehbaz Sharif’s visit to Egypt. “And it seems that China will also make some more pledges.”

Moreover, he said, a refinery policy was also due and gas prices were expected to rise. “This is why we are seeing increased buying in the oil sector,” he explained.

Head of Equities at Intermarket Securities, Raza Jafri, also said there was value buying in the oil and gas exploration sector but added that investors were also showing interest in shares of Islamic banks after the finance minister indicated “support for full Shariah conversion of the banking system”.

Finance Minister Ishaq Dar announced on Wednesday that the State Bank of Pakistan and the National Bank of Pakistan would be immediately withdrawing appeals against an April decision of the Federal Shariat Court (FSC) in which it gave the government five years to eliminate Riba (interest-based) banking from the country.

The government had challenged the FSC decision in April.