PSX's quiet session belies building momentum for next rally

KARACHI: The Pakistan Stock Exchange (PSX) experienced a marginal increase in trading activity today, with the benchmark KSE-100 index rising by 73.02 points or 0.09% to close at 78,356.31.

The index fluctuated between a high of 78,644.96 and a low of 78,250.89 throughout the day, with a total volume of 436,672,976 shares being traded. The value of these trades amounted to Rs 12,255,171,947, with 225,114 transactions taking place.

The Pakistan Stock Exchange (PSX) benchmark KSE-100 index opened on a positive note and remained volatile throughout the last trading session, according to AKD Research. The local bourse posted a high of 526 points, a low of 248 points and concluded with a loss of 205 points to settle at 78,283 points.

The volumes witnessed in the last trading session decreased by 18% than the previous trading session. The Index closed below the upper band by 38.2%. Bollinger Bands are 68.35% narrower than normal.  The narrow width of the bands suggests low volatility as compared to the normal range of the Index, said AKD Research. During the past 10 trading sessions, there have been 3 white candles and 7 black candles for a net of 4 black candles.

The recent data depicts that the index may find initial support near 78,200. A break below-mentioned support can result in further weakness towards the 77,800 and 77,500 points level, according to AKD Research. Alternatively, the index can face resistance near 78,800 points initially and then head towards 79,100 and 79,400 areas. It is recommended to initiate buying positions near the support zone with risk defined below it.

On the surface the session may seem lacklustre with a flat close however market internals suggest the market is poised for a fresh leg higher, said AHL Sales. 57 stocks rose while 43 fell MTL PA (+5.1%), MARI PA (+1.93%), OGDC PA (+0.68%) had the largest upside contributions while MEBL PA (-0.94%), MCB PA (-0.99%) and BAHL PA (-1.15%) were the biggest index drags.

The key takeaway from the session of Pakistan Stock was that a few momentum stocks traded away from lower limits, and there was a demand for cement stocks, according to AHL Sales. Anticipating the market to now trade through 79,100 towards 80,000 this week with rotation out of banks into cement names.

With the start of September, the PSX KSE-100 has now entered into a seasonally strongest time window which extends to the end of January.

Pakistan Stock closed higher amid upbeat data on consumer price index (CPI) Inflation at 9.6 pc for August 2024 and reports of the government plan for strategic sale of blue-chip state-owned enterprises (SOEs) to foreign investors, said Ahsan Mehanti CEO of Arif Habib Corp.

In the session, leveraged stocks outperformed on investors’ hopes for a cut in the State Bank of Pakistan (SBP) policy rate and the resolution of external financing gaps this month played a catalyst role in a bullish close.