KARACHI: The banking sector remained the top contributor to the rise of 8.8 per cent in the benchmark index in January, according to a research report issued by Arif Habib Ltd on Friday.
The sector contributed 996 points out of 3,578 points that the index gained last month. Large banks attracted significant foreign inflows as they are part of the MSCI EM Index. Habib Bank led the way by contributing 408 points to the index recovery, constituting 11.4 per cent of the benchmark gain, followed by Bank Al Habib (143.4 points) and MCB Bank (122.2 points).
The Pakistan Stock Exchange (PSX) attracted net foreign inflows of $85.7 million, biggest monthly inflows in almost four years. Banks attracted net foreign funds of $25 million, or 29 per cent of total inflows.
Expectations of an interest rate hike, which materialised with a 25 basis-point hike in the monetary policy announcement last week, along with attractive valuations in the sector managed to catch the attention of investors, it said.
In terms of price performance, small and mid-tier banks led the price uptick. Bank of Punjab registered a price increase of 22.1 per cent, followed by Meezan Bank (14.4 per cent), Bank Al Habib (12.8 per cent) and Faysal Bank (12.8 per cent).
