PSX ends on positive note despite foreign selling

KARACHI: Despite foreign selling, the Pakistan Stock Exchange managed to close on positive note on weekly basis during the outgoing week ended on September 13, 2024 on the back of fresh buying by local investors coupled with institutional support.

The benchmark KSE-100 index increased by 435.33 points on week-on-week basis and closed at 79,333.06 points. The index briefly crossed 80,000 psychological level during the week, however failed to sustain this level due to profit taking in some stocks.

Trading activities remained low as average daily volumes on ready counter decreased by 10.2 percent to 606.74 million shares during this week as compared to previous week’s average of 675.46 million shares while average daily traded value on the ready counter increased by 4.7 percent to Rs 15.24 billion during this week against previous week’s Rs 14.57 billion.

BRIndex100 gained 60.95 points during this week to close at 8,400.98 points with average daily turnover of 462.899 million shares.

BRIndex30 added 233.16 points on week-on-week basis to close at 27,189.54 points with 302.047 million shares.

The foreign investors however remained on the selling side and withdrew $7.537 million from the local equity market.

An analyst at JS Global Capital said that the KSE-100 index briefly crossed the psychological barrier of 80,000 points but was unable to maintain the level due to selling pressure on the last trading day.

In a significant development, the much-awaited update on the IMF program emerged, with the IMF Executive Board scheduled meeting, to approve the $7.0 billion Extended Fund Facility (EFF), as highlighted in their press briefing. The central bank also announced a 200bps cut in Policy rate bringing it down to 17.5 percent. FBR also hinted an announcement of Rs650billion mini-budget to meet the revenue shortfall, with potential increase in WHT on properties and GST on tractors alongwith strict measures to be taken against non-filers.

An analyst at Arif Habib Limited said that the market experienced initial pressure due to selling by investors, but several positive economic developments emerged throughout the week. The State Bank of Pakistan (SBP) continued its monetary policy easing cycle, cutting the policy rate by 200bps to 17.5 percent, a move not seen since April 2020. As a result, KIBOR rates fell between 25 to 119bps across various tenors, which was welcomed by market participants.

On the international front, there was significant progress regarding Pakistan’s IMF program, as the country’s name was officially added to the IMF board’s meeting agenda for 25th September 2024.

Sector-wise positive contributions came from fertilizer (up 161 points), cement (up 159 points), E&P (up 92 points), Leather (up 74 points) and pharmaceutical (up 54 points). Meanwhile, the sectors that mainly contributed negatively were commercial banks (down 119 points), automobile (down 115 points) and power generation (down 80 points).

Scrip-wise positive contributors were EFERT (up 121points), OGDC (up 100 points), SRVI (up 74 points), UBL (up 69 points) and LUCK (up 66 points). Meanwhile, scrip-wise negative contributions came from MTL (down 115points), MEBL (down 85 points), MARI (down 85 points), HUBC (down 81 points) and HBL (down 78 points).

Foreigner selling continued during this week, clocking in at $7.5 million compared to a net sell of $6.7 million last week. Major selling was witnessed in Fertilizer ($3.7 million) and Banks ($2.9million). On the local front, buying was reported by individuals ($7.2 million) followed by MUTUAL FUNDS ($4.8 million) and companies ($4.4 million).

Copyright Business Recorder, 2024