KARACHI: Stocks staged a strong rally on Tuesday as the KSE-100 index showed massive gains of 537.79 points (1.5 per cent) to close at 37,517.75.

Investors, mainly ‘individuals’ fell over one another in anticipatory buying just a day ahead of the decision on Pakistan’s upgradation to MSCI Emerging Market Index. Opening with a positive change of 314 points, the index kept climbing upwards throughout the day.

Volumes increased by 3pc to 143.6 million shares while value rose 28pc to Rs9.6bn. K-Electric and Pakistan International Bulk Terminal were volume leaders accounting for 38m shares traded.

The rally on Tuesday came on the back of those names which are likely to be included in the MSCI EM Index. HBL, LUCK, FFC, HUBC, MCB, OGDC, UBL, ENGRO and PSO added 342 points to the index while NESTLE, MTL and MLCF took away 16.33 points. Banking stocks also gained for the second consecutive day. HBL closed at its upper limit (up 5pc), while MCB and UBL increased 3.9pc and 2.2pc, respectively.

Analyst Arhum Ghous at JS stated that the nine proposed stocks in the large capitalisation and mid-tier category of MSCI EM Index led the rally. Besides, HCAR up 3.3pc and INDU 0.4pc to close in the green zone on the back of one-time tax imposed on imported vehicles above 1300cc engine capacity by the Punjab government in its FY17 budget announcement.

Investor interest was also seen in the fertiliser sector as Punjab allocated Rs100bn under the Kissan package to address the issues of farmer community and food security over the course of two years.

Major gainers of the aforementioned sector were FFC rose 2.3pc and ENGRO 1.1pc. The cement sector also caught investors’ attention after reports that manufacturers had hiked cement prices to pass on the increase in FED.

Published in Dawn, June 15th, 2016