In January 2018 the bourse gained 3,578 points, giving a 13-month high return of 8.8 percent, led by banks, analysts said. The top contributors were commercial banks, contributing 996 points to the index. Large banks being part of the MSCI EM main index attracted significant foreign inflows. Habib Bank led the way, contributing 408 points alone to the index recovery (constituting 11.4 percent of the index gain in the said period), followed by BAHL and MCB (143.4 points and 122.2 points, respectively).
Out of the mid-tier banks, apart from BAHL, BAFL supported the index by 65 points. During the said period, the PSX attracted staggering net foreign inflows of $85.7 million - biggest monthly inflow in almost four years (46 months) - of which $28 million have been concentrated in cements (33 percent), followed by banks which have attracted net foreign inflow of $25 million (29 percent).
Expectations of an interest rate hike (which materialized with a 25 bps hike in the SBP MPS last week) along with attractive valuations in the banking sector managed to catch the attention of investors. In terms of price performance, small- and mid-tier banks primarily led the price uptick in the sector.
Comments
Comments are closed.