RECORDER REPORT

KARACHI: Bullish trend continued on Pakistan Stock Exchange during the outgoing week ended on October 11, 2019 on the back of healthy buying in almost all sectors.

BRIndex100 gained 155.25 points on week-on-week basis to close at 3,631.13 points. Average daily trading volumes stood at 265.678 million shares.

BRIndex30 increased by 927.28 points to close at 19,187.64 points with average daily turnover of 186.817 million shares.

KSE-100 index surged by 1,442.37 points on week-on-week basis and closed at 34,475.69 points. Average daily trading volumes on ready counter increased by 27.6 percent to 284.30 million shares as compared to previous week’s average of 222.84 million shares while average daily trading value increased by 42.3 percent to Rs 8.89 billion.

The foreign investors remained net sellers of shares worth $4.2 million during this week. Total market capitalization increased by Rs218 billion to Rs 6.771 trillion.

An analyst at AKD Securities said that the KSE-100 index closed the week at 34,476 points, up 4.37 percent on week-on-week basis marking the week as its second consecutive week closing in green.

The inverting yield curve, stable currency since past three months and, potential Euro bond and Sukuk issues expected to shore up forex reserves have resulted in bullish sentiment in the market, leading to KSE-100 increasing by 19.8 percent from its low of 28,764 points in August 2019. The week began with the release of FATF report on Pakistan, according to which the country was compliant on 1 criterion, partially compliant on 26 criteria and largely compliant on 9 criteria as of October 2018, where the Government of Pakistan has taken material steps since then to address issues in the 4 areas of non-compliance. Meanwhile, PIB and T-bill auctions indicated an inverting yield curve – rates on 10 year PIBs declined by 50bps since the last auction to 11.74 percent, while yields on 3/6/12 month declined by 4/28/38 bps to 13.69/13.55/13.46 percent since the last auction, driving market into buying frenzy.

Also, the PSX introduced minimum brokerage commission at 3 paisa per share or 0.15 percent of the transaction value, whichever is higher for the ready market, which will be effective from 14th October 2019. Sector wise, major developments included cement players in North increasing prices by Rs15-20/bag to Rs 520-530/bag, this being the second consecutive weekly hike in cement prices from Rs 450-500/bag earlier, keeping the cement stocks in limelight.

Top performers during the week in the AKD Universe were FFBL (up 14.43 percent), MEBL (up 13.55 percent), HASCOL (up 10.98 percent), PAEL (up 10.45 percent) and EFOODS (up 9.79 percent) while FCCL (down 2.67 percent) and PSMC (down 2.29 percent) were among the major losers.

An analyst at Topline Securities said rising for the 2nd consecutive week, Pakistan bourse gained 4.37 per cent last week. From its recent bottom of 28,765 seen on 16th August 2019, the KSE-100 Index has gained 20 per cent. This sharp recovery is led by falling yields in the local currency bond market. Benchmark 10- year PIB traded at 11.34 percent on Friday down from 12.03 percent a week back. In last 2 months PIB yields have fallen by close to 250ppts.

Moreover, last week rally saw volumes increasing substantially. On Friday value traded of Rs 10.5 billion was highest in the calendar year 2019 and was far better than 2019 average daily value of Rs 4.9 billion.