KARACHI: Pakistan Stock Exchange remained range bound during the outgoing week ended on July 29, 2022 due to political uncertainty and deteriorating macroeconomic indicators.
The benchmark KSE-100 index closed at slightly positive note at 40,150.36 points, up only 73.06 points on week-on-week basis. Trading activities also remained low as average daily volumes on ready counter declined by 8.1 percent to 150.08 million shares as compared to previous week’s average of 163.39 million shares however average daily traded value on ready counter increased by 9.2 percent to Rs 5.17 billion.
BRIndex100 gained 15.41 points during this week to close at 3,968.38 points with average daily turnover of 138.952 million shares.
BRIndex30 increased by 234.20 points on week-on-week basis to close at 14,609.77 points with average daily trading volumes of 106.629 million shares.
Total market capitalization increased by Rs 18 billion during this week to Rs 6.771 trillion.
“In the outgoing week, political turmoil along with concerns regarding the Rupee dominated the market, creating an uncertain environment”, an analyst at AKD Securities said adding that the current account deficit numbers for June came in at $2.3billion, up 59 percent on month-on-month basis.
Amid the fog, the KSE-100 remained flat to close at 40,150points, up 0.2 percent on week-on-week basis while average volume for the index remained low at 150.1million shares (down 8.2 percent on WoW), as investors stayed wary of the market.
Sector-wise, top performing sectors were Vanaspati and Allied Industries (up 5.4 percent), Technology and Communication (up 4.7 percent), Textile Composite (up 3.8 percent), Woolen (up 3.4 percent) and Textile Weaving (up 3.1 percent), while the least favourite sectors were Automobiles Parts and Accessories (down 5.5 percent), Automobile Assemblers (down 5.4 percent), Fertilizer (down 4.0 percent), Leather and Tanneries (down 3.7 percent) and Close-End Mutual Fund (down 2.4 percent).
Stock-wise, top performers in the KSE-100 were TRG (up 18.1 percent), FABL (up 17.6 percent), LOTCHEM (up 14.2 percent), KEL (up 8.6 percent) and APL (up 8.1 percent), while laggards were ATRL (down 22.3 percent), EPCL (down 21.1 percent), CHCC (down 20.9 percent), GATM (down 17.1 percent) and NRL (down 16.6 percent.
Flow-wise, Individuals were the largest sellers, offloading $2.0million followed by Insurance Companies ($1.8million), Mutual Funds ($1.2million), Brokers ($1.2million), Foreigners ($567.3million), Other Organizations ($65.1million), and NBFC ($11.4million). While Banks and Companies were on the buying side, with a net buy of $3.3million and $2.4million respectively.
An analyst at JS Global Capital said that political uncertainty and deteriorating macroeconomic indicators kept the market range bound as benchmark KSE-100 index closed the week on a slightly positive note at 40,150, up 73 points onWoW.
Key underperformers during the week were Autos (down 5.4 percent), Fertilizer (down 4.0 percent) and Refinery (down 1.9 percent) sectors while Technology (up 4.7 percent), Textiles (up 3.8 percent) and Banks (up 1.6 percent) outperformed.
The week started with political noise over elections for CM Punjab as Hamza Shahbaz was appointed the Chief Minister. However, later in the light of Supreme Court’s ruling, Parvez Elahi was declared CM Punjab.
On the economic front, macros further deteriorated as Pak Rupee depreciated 14 percent against the US$, marking July the worst month in the last five decades. Moreover, current account balance recorded a deficit of $2.3billion, up 39 percent on YoY and 59 percent on WoW. SBP reserves also witnessed a sharp decline of $754million to $ 8.6billion.
Based on deteriorating macros, S&P also revised the outlook on Pakistan’s Long Term Rating to ‘Negative’ from ‘Stable’. On the news front, electricity base tariff was revised upwards by Rs7.91/unit. Moreover, Indus Motors Co halted its production due to delay in imports of CKDs.
Copyright Business Recorder, 2022
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