Sentiments at the Karachi Stock Exchange (KSE) remained positive during the last week ended on Friday and overall the benchmark KSE-100 index rose by 234 points to close at highest level of 16,808 points, up from 16,574 points a week ago.
"Local bourse continued to post upward trend for the second consecutive week as investors remained interested in leading sectors on hopes of a rate cut in the State Bank of Pakistan''s monetary policy announcement, likely to be announced this week," analysts said.
The week started with a positive development in CPI inflation, which remained at 6.93 percent in November, analysts said. "This fizzled out the battle between status quo and 50 percent cut in the discount rate for the upcoming monetary policy statement giving a boost to expectations of 50-100 basis point cut in the interest rate."
Sentiments also perked up after the constructive Pakistan-US talks after Washington pledged another $200 million for Diamer-Bhasha dam, in addition possible disbursement of $600mn under Coalition Support Fund (CSF), an analyst at KASB Securities said. Week-on-Week (WoW) basis, the benchmark KSE-100 rose up by 1.4 percent and total market capitalisation increased by Rs65.73 billion to Rs4.217 trillion from Rs4.152 trillion a week earlier.
Average daily trading value declined to Rs5.82 billion from Rs6.3 billion. Trading activity was also on the lower side during the week. With a decline of 18.2 percent, daily volumes shrank to 239 million shares against previous week''s average volume of 292 million shares. Volumes were led by LOTPTA, JSCL, FCCL, BYCO and ANL. Foreign investors, however, remained on the selling counter off-loading net positions worth $2.2 million.
On the first day of trading, the market opened in the green zone, gaining nearly 60 points during the initial hours. However, the market ended lower, as investors preferred booking profits in the banking sector. On Monday, the benchmark KSE-100 lost 36 points, closing at 16,538 points.
On Tuesday, the Karachi share market witnessed positive trend and KSE-100 index gained 112.17 points to close at 16,650.15 points. After fluctuations, on Wednesday, the KSE-100 index up by 25.55 points to close at a new high level of 16,575.70 points. The Karachi share market continued to set new records and the benchmark KSE-100 index on Thursday closed at another all-time high level of 16,824.55 points, up by 148.85 points. On the last trading day, Karachi Stock Exchange hit a record high level of 16,900 points in intra-day trading, but settled lower, as investors preferred to book profit in cement, banking and other leading sectors. On Friday, KSE-100 lost 16.64 points to close at 16,808 points.
Naveed Tehsin, an analyst at JS Global, said that sentiments at the local bourse remained positive during the outgoing week, where the second and the third tier stocks were in the limelight. On macro front, forex reserves fell to $13.5 billion and CPI for November clocked in at 6.9 percent Year-on-Year, he said.
Other key highlights of the week included issuance of a notification by Pakistan Telecommunication Authority (PTA) to suspend International Clearing House (ICH) agreement and increase in price of Polyester Staple Fibre (PSF) by local manufacturers after anticipation of imposition of 10.5 percent duty on imports, he said. Strong cement dispatches (2.7 million tons) for November 2012, up by 18 percent on year-on-year basis, kept the appetite for cement stocks strong, analysts said.
"MPS is expected next week and it appears that some 50 basis points cut is on the cards. Other than this, any concrete developments over potential disbursement of CSF should also alleviate concerns over external account," analysts said. These developments are likely to keep the stock market on upward side, they said.
Comments
Comments are closed.