RECORDER REVIEW

KARACHI: Pakistan Stock Exchange witnessed positive trend during the outgoing week ended on June 7, 2018 on the back of healthy buying mainly by local investors.

BRIndex100 gained 136.58 points to close at 4,720.39 points from last week’s closing of 4,583.81 points. Average daily volumes stood at 160.106 million shares.

BRIndex30 increased by 597.17 points to close at 23,423.18 points with average daily turnover of 124.094 million shares.

Pakistan’s benchmark KSE-100 index surged by 1,035.30 points on week-on-week basis and closed at 43,948.11 points. Trading activities also improved as average daily volumes on ready counter increased by 54.4 percent to 183.79 million shares as compared to previous week’s average of 119.04 million shares. Average daily trading value increased by 62.0 percent to Rs 9.04 billion.

The foreign investors remained net sellers of shares worth $29.55 million as compared to an outflow of $17.45 million in previous week. Total market capitalization increased by Rs 129 billion to Rs 9.036 trillion.

An analyst at AKD Securities said that the benchmark KSE-100 index continued its bull run into the second week post announcement of caretaker setup, closing at 43,948 points, up 2.41 percent on week-on-week basis.

Investor interest was spread across the sectors, with Banks, Oil & Gas and Cements rallying 4.1/1.6/2.8 percent. More specifically, both the gas utilities (SNGP and SSGC) gained 12.3/6.9 percent as OGRA announced revised tariff regime (applicable from FY19). Under the revised formula, return on assets is now linked to a market based WACC calculation (resulting in 17.43 percent RoA for both the utilities in their bundled form), in turn providing clarity to investors over their future outlook.

Performance leaders in the AKD universe were UBL (up 7.91 percent), HBL (up 7.54 percent), BAFL (up 6.28 percent), LUCK (up 6.16 percent) and FATIMA (up 5.11 percent) while laggards included KEL (down 3.01 percent), INDU (down 2.66 percent), PSMC (down 1.56 percent), NCL (down 1.13 percent) and KAPCO (down 0.49 percent).

An analyst at JS Global Capital said that the local bourse closed another week on a positive note with KSE-100 index gaining 2.4 percent on week-on-week basis. Bulls remained in charge as appointment of six-member caretaker cabinet during the week affirmed investor confidence. Newly appointed Minister of Finance Dr Shamshad Akhtar took notice of deteriorating macros quickly, holding review meetings on the economy and is also expected to meet IMF officials during their visit to Pakistan.

Among key sectors, Oil & Gas Marketing Companies (up 4.2 percent), Banks (up 4.1 percent) and Chemicals (up 5.2 percent) outshined as attractive multiples drew investor attention; while Power (down 1.9 percent) and Textile Composite (down 2.0 percent) remained the major laggards. Key stocks which garnered attention during the week were Sui Northern Gas Pipeline (SNGP, up 12.3 percent) and Sui Southern Gas Co (SSGC, up 6.9 percent) as OGRA approved new market based tariff regime for the aforementioned companies as compared to fixed return formula previously. In the autos space, key development was notification by Nishat Mills Ltd (NML, up 1.6 percent) to announce completion of its assembly plant for Hyundai vehicles in December 2019.