KSE 100 Recovers 0.4% as Fertilizer Gains Offset Cement Sector Pressure
Staff Report:
The KSE 100 Index opened on a negative note, primarily driven by pressure in the cement sector, as the index declined to an intraday low of -1,540 points.
The pressure in the cement sector stemmed from reports of disputes among manufacturers over increasing market share and adjusting geographic sales to secure higher retention prices.PSX Rallies as Investor Confidence Peaks
Some players were reportedly encroaching on the volumes of others, creating unease within the sector. However, in the second half of the trading session, investors utilized available liquidity to buy the dip, leading to a recovery. The index ultimately closed at 117,587, reflecting an increase of 0.4%.
The fertilizer sector made the most significant positive contribution to the index, with EFERT, FFC, DAWH, and ENGRO collectively adding 911 points. This interest in the fertilizer sector was fueled by expectations of a 53% month-on-month increase in dispatch numbers for December 2024.
Conversely, LUCK, SYS, PPL, FCCL, and PIOC lost value, collectively dragging the index down by 466 points. In terms of traded value, ENGRO (Rs.2.14 billion), FFC (Rs.2.11 billion), FCCL (Rs.1.88 billion), PSO (Rs.1.76 billion), and PAEL (Rs.1.44 billion) dominated trading activity.
In the Topline Weekly Review for January 3, 2025, the KSE 100 Index posted a weekly gain of 5.6%. This increase can be attributed to the December CPI inflation figure, which came in at 4.1% (compared to 4.9% in November 2024), marking the lowest reading in 81 months.
The low inflation number boosted investor optimism regarding a potential policy rate cut in the upcoming monetary policy meeting in January. Other developments during the week included Pakistan’s trade deficit for December, which stood at $2.44 billion, reflecting a 35% year-on-year increase, and GDP growth for the first quarter of FY25, which posted an expansion of 0.92%. The average daily traded volume and value for the week were 1.05 billion shares and PKR 43.5 billion, respectively.
