A bullish week

Mood at Karachi bourse remained bullish throughout the week, as active participation was witnessed by both local and foreign investors. The KSE-100 benchmark index gained 539.28 points after it closed at 21,823.05 against 21,283.77 a week ago. Commenting on the performance of local equity market, analysts at JS Global said that investors maintained their confidence level at KSE on the back of PML-N's pro-business stance.
"During the week, there were news reports suggesting that the Federal Board of Revenue (FBR) had rescinded the zero-rated facility for dairy and other products without even breaking the positive momentum at the stock exchange. However, the banking sector remained under pressure, as it underperformed the market by 0.5 percent mainly on fears of further shrinkage in spreads on the back of further cuts in discount rate in the upcoming MPS," the analysts said.
Interestingly, when the presumptive Prime Minister, Nawaz Sharif, talked about chalking out a new plan for solving electricity by building more dams and promoting the use of coal for producing thermal electricity, oil and gas sector outperformed the market by 1.7 percent with OGDC (+5.4%WoW) and PSO (+6.6%WoW) remaining star performers.
The impact of FBR's decision to end zero rated GST facility was over shadowed by the general bullish sentiments, as EFOODS (market leader of packaged milk) remained in the green and closed the week up 5.4 percent.
Banks remained in the red as concerns of another discount rate cut loomed large. As a result, the banking sector underperformed the market by 0.5 percent. However, BoP managed to clock in a return of 28.6 percent during the week mainly on speculation of a major turnaround for the beleaguered bank under the new government.
Weekly average volume witnessed an increase of 5.2 percent, increasing to 461.71 million shares against 438.77 million a week ago and market capitalisation also remained on the higher side, up by 2.7 percent, closing at Rs 5.293 trillion, up from Rs 5.156 trillion.
While average daily value witnessed a bearish-trend, posting a decrease of 20.4 percent, closing at Rs11.16 billion against Rs14.02 billion during the previous trading week.
Universal top performers during the week were Engro Polymer, Indus Motor Company, Pakistan State Oil, Adamjee Insurance, ICI Pakistan, OGDCL, Engro Foods, Kot Addu Power, Hubco and Nishat (Chunian) Ltd.
On Monday, Karachi share market closed lower amid profit-taking by foreign and local investors. The benchmark KSE-100 index lost 324.91 points, closing at 20,958.86, down points from 21,283.77 points on Friday last week. KSE rebounded on Tuesday and benchmark index touched new high supported by foreign investors who delved in oil and gas sector. The benchmark KSE-100 index gained a staggering 542.86 points in a single day and closed at a fresh peak of 21,501.72 points.
On Wednesday, Karachi share market ended lower amid profit-taking in heavyweight scrips. The benchmark KSE-100 index lost 60.60 points to close at 21,441.12 points. New records were set on Thursday at the Karachi stock market on the back of heavy buying of financial sector stocks. KSE-100 index closed at highest-ever level of 16,527 points.
And on Friday, the last trading day of the week, Karachi bourse continued its upbeat performance and the benchmark KSE-100 index rose by 232.39 points to close at a new peak level of 21,823.05 points.