RECORDER REVIEW
KARACHI: Pakistan stock market remained under pressure during the outgoing week due to political uncertainty and foreign selling and the benchmark KSE-100 index lost 172.88 points (0.44 percent) to close at 41,291.43 points from last week’s closing of 41,494.31 points.
Trading activities, however, improved as the average daily volumes at ready counter increased by 16.9 percent to 471.88 million shares as compared to last week’s average of 403.80 million shares. Average daily trading value surged by 6.1 percent to Rs 14.70 billion. Total market capitalization decreased by Rs 24 billion to stand at Rs 8.429 trillion.
The foreign investors emerged net sellers of shares during the outgoing week and withdrew $8.46 million from Pakistan stock market.
Faizan Ahmed at JS Global Capital said that overall sentiments remained mixed at the bourse with the market struggling to break 42,000 level. In the mainstream sectors, most of the interest remained tilted towards OMCs, textiles and E&Ps. On the other hand, sectors such as cements and fertilizers witnessed profit taking. Most of this increase in trading activity can be attributed to local AMCs where reported injection by a major pension fund incited broad based buying in the market.
The weekly research report of AKD Securities said that the correction was led by continued rise in political tensions and foreign outflows.
An analyst at KASB Securities said that despite support from oil, the index witnessed a see-saw ride during the week as political noise kept the index range-bound. Profit taking and uncertainty related to geopolitical situation led the index to close at 41,291 points, slightly down by 0.4 percent on week-on-week basis.
After starting the week from the last week’s all-time high closing of 41,464 points, rise in local political tensions took its toll on the index. Following profit-taking in the first two sessions, investors took the chance to purchase the stocks from the support zone of 40,500 leading to massive rally only to get succumbed to profit taking in the next session. Oil sector posted some gains in the midweek but remained under pressure even after an increase in oil prices on the back of latest government proposal to force application of 50 percent windfall levy on oil prices under recently signed supplemental agreements, which amounts to big policy reversal, in our view. Some excitement was seen in textile composite sector as the market anticipates a new incentive package to be announced soon. The news that Hub Power Company (Hubco) is going to reduce the capacity of its new power plant because of timing issues dented the investors’ confidence in the scrip. Honda Altas commencing their new production site was taken positively by the investors as the stock posted some gains.
Some big tickets’ results were also announced during the week spurring some activity. Attock Petroleum and United Bank Limited (UBL) gained traction after posting good results. On the other hand, Attock Refinery and National Refinery turned out to be losers after posting a result below market expectations. Even retail favourite scrips felt the brunt of strong profit taking as TRG closed 3.3 percent down on week-on-week basis.
