KARACHI: Pakistan Stock Exchange witnessed bullish trend and hit historic highest levels with exceptionally increasing trading volumes during the outgoing week ended on November 17, 2023 on the back of aggressive buying after Staff Level Agreement with IMF, growing anticipation of interest rate cut and decline in oil prices in both local and international markets.
The benchmark KSE-100 index surged by 1671.79 points on week-on-week basis and crossed 57,000 historic-level to close at 57,063.16 points.
Trading activities also improved as average daily volumes on ready counter increased by 39.8 percent to 760.76 million shares as compared to previous week’s average of 544.05 million shares while average daily traded value on ready counter increased by 22.5 percent to Rs 23.71 billion during this week against previous week’s Rs 19.36 billion.
BRIndex100 added 176.35 points during this week to close at 5,824.81 points with average daily turnover of 682.491 million shares.
BRIndex30 increased by 861.10 points on week-on-week basis to close at 20,644.17 points with average daily trading volumes of 482.941 million shares.
The foreign investors also remained net buyers of shares worth $8.218 million. Total market capitalization increased by Rs 328 billion to Rs 8.281 trillion.
An analyst at AKD Securities said that the market sustained its positive momentum and surged to record highs, with the KSE100 index closing at record high of 57,397points on Thursday before a slight correction to close at 57,063points on Friday, an impressive 3.02 percent WoW increase.
The week centred on the IMF review, concluding with a successful staff-level agreement, anticipating a $700million inflow post-IMF Board approval. A major development was the government’s implementation of a 40 percent tax on banks’ windfall income, meeting IMF demands and to agree on further revision in the gas prices in January 2024.
The market participation witnessed a substantial improvement, with an average traded volume of 687million shares, marking a 26 percent WoW increase from the previous week’s average of 544million shares. Notably, Thursday saw participation cross the 1.0 billion share mark for the first time in last 28 months.
Sector-wise, close-end mutual funds, synthetic & rayon, and woollen were amongst the top performers, up 24.0 percent/21.7 percent/12.0 percent respectively. On the other hand, vanaspati & allied industries, commercial banks, and textile weaving were amongst the negative performers with a decline of 0.5 percent/0.5 percent/0.4 percent WoW.
Flow wise, major net selling was recorded by Banks with a net sell of $9.14million. On the other hand, Foreigners remain bullish with a net buy of $8.22million.
Company-wise, top performers during the week were HGFA (up 26.0 percent), PAEL (up 22.7 percent), RMPL (up 21.3 percent), IBFL (up 20.8 percent) and PKGP (up 19.6 percent), while top laggards were BIPL (down 7.6 percent), BAFL (down 6.7 percent), CNERGY (down 5.4 percent), PABC (down 3.9 percent) and MEBL (down 3.6 percent).
An analyst at JS Global Capital said that the KSE-100 index continued to score new highs, closing at 57,063, up 3 percent WoW.
Optimism in the market was mainly driven by decent inflows, Staff Level Agreement with the IMF, growing anticipation of interest rate cuts following the recent drop in T-bill cut-off yields, and decline in both domestic and international oil prices.
Pakistan is now expected to receive around $700million in December 2023 subject to approval by the IMF’s Executive Board. Subsequent to IMF talks, the government also hinted further hike in gas prices in January 2024. Federal Cabinet also approved imposition of 40 percent additional tax on Banks’ Income from FX retrospectively, for CY21-22, which impacted banking stocks’ performance.
International Oil prices on the other hand, continued to drop, hitting a 4-month low over concerns on the US and Chinese demand. This week, the MSCI quarterly review revealed that 17 Pakistani stocks maintained their inclusion in the MSCI Frontier Market Index, with no changes. However, there were adjustments in the MSCI FM Small Caps Index scheduled to take effect from December01, 2023. Notably, KOHC, MLCF, FABL, and SHEL were removed from the index, while PSMC, AGHA, SAZEW, and AGP were added.
Copyright Business Recorder, 2023
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