RECORDER REVIEW
KARACHI: Pakistan Stock Exchange (PSX) witnessed positive trend during the outgoing week and the benchmark KSE-100 index increased by 154.33 points to close at 49,364.83 level.
Trading activities, however, remained low as average daily volumes on futures counter declined by 20.5 percent to 388.51 million shares as compared to previous week’s average of 488.87 million shares. The average daily trading value decreased by 2.3 percent to Rs 22.17 billion against previous week’s average of Rs 22.68 billion. Total market capitalization increased by Rs 45 billion to Rs 9.904 trillion.
The foreign investors, however, remained net sellers of shares and withdrew $47 million from Pakistan stock market.
The market remained under pressure from the beginning of the week as the index declined by 321.96 points and closed on 48,888.54 points on Monday. Negative trend continued on Tuesday and the index lost another 209.89 points to close at 48,678.65 level. The market witnessed another bearish session on Wednesday and the index closed at 48,642.21 points, down 36.44 points. The market turned bullish on Thursday on the back of fresh buying mainly by local investors and institutions and the index increased by 371.61 points to close at 49,013.82 points. Bullish trend continued on Friday and the index gained another 351.01 points to close at 49,364.83 points on the last day of the trading week.
An analyst at JS Global Capital said that the market witnessed profit taking during the first half of the week. Later however, bulls took charge to help Index close in the green. Some of the key sectors which remained in the limelight were Refineries (+7.7 percent), Automobiles (+7.2 percent) and OMCs (+1.3 percent). On the other hand, Index heavyweights E&Ps (-4.1 percent), Banks (-2.6 percent) and Cements (-0.1 percent) witnessed profit taking. Most of the selling in E&Ps came in Oil & Gas Development Company Limited (OGDC), where news emerged of a proposal to sell 5.0 percent stake by the government, resulting in 8.0 percent fall in the stock price.
An analyst at AKD Securities said that the index remained volatile during the week owing to political developments related to Panamagate case. Textiles, Autos and Steels were the major driving sectors owing to announcement of textile package, early models launch/robust sales, and imposition of anti-dumping duty on CRC imports, respectively. Whereas E&Ps and Banks provided major drag on Index due to foreign selling as PC approved divestment in OGDC.
An analyst at Arif Habib Limited said such was the resistance before crossing the coveted 50,000 mark that the KSE-100 index went into correction mode at the beginning of the week, albeit closing at 49,365 levels, up 0.3 percent on week-on-week basis of particular prominence was the 780 points intraday dip witnessed on Tuesday given strong trend lines suggesting correlation to the Panama case hearings; however the market recovered to close slightly negative by day-end.
Pertinently, lackluster performance at the local equity bourse was subject not just to the political tensions at home but continued foreign selling in the wake of oath-taking ceremony of the new US President Donald Trump which remained visible in various global equities. Overseas’ investors continued to offload Banks ($ 9.25 million; negative contribution of 318 points), Power ($5.95 million; negative contribution of 5 points) and Cements ($5.01 million; positive contribution of 26 points as locals absorbed foreign pressure). Meanwhile support to the index was restored by mid-week; on the back of signing of the 40 percent PSX shares sale and purchase agreement with the Chinese consortium on Friday as key reason for the recovery in sentiments. Whereas, positive contribution to the index was led by the Automobile sector (160 points) owed to introduction of new models by HCAR / PSMC, Refinery sector (63 points) based on robust result expectations, and Textile Composite (63 points) given euphoria over the PM’s export package.
