Pakistan Stock Exchange remained under heavy pressure during the outgoing week ended on August 30, 2019 due to panic selling in almost all sectors due to investors' concerns over geopolitical and economic situation.
BRIndex100 fell 212.13 points on week-on-week basis to close at 3,075.81 points from previous week's closing level of 3,287.94 points. Average daily trading volumes stood at 113.714 million shares.
BRIndex30 declined by 1360.28 points to close at 15,707.71 points with average daily turnover of 78.216 million shares. KSE-100 Index plunged by 1,677.90 points or 5.35 percent on week-on-week basis and closed below 30,000 points at 29,672.12 points. Trading activities remained low as average daily volumes on ready counter decreased by 29.0 percent to 123.88 million shares as compared to previous week's average of 174.41 million shares. Average daily trading value declined by 23.4 percent to Rs 4.56 billion.
The foreign investors remained net buyers of equities worth $0.97 million during this week as compared to net selling of $4.97 million in previous week. Total market capitalization declined by Rs 258 billion or 4.1 percent to stand at Rs 6.082 trillion.
An analyst at AKD Securities said that the market retraced 62 percent of its rally of the previous week, tumbling down by 5.35 percent (1,678 points) to 29,672 points during the outgoing week. The placement of Pakistan on 'enhanced expedited follow up list' by APG on Friday (August 23rd, 2019) crushed investor sentiment, with market closing the first trading session in red. In addition to that, the reported potential divestment of PPL (10 percent of shares) and OGDC (7 percent of shares), index heavy weights, built further pressure on KSE-100. The Government of Pakistan also introduced presidential ordinance to waive off 50 percent of outstanding GIDC over dues from the CNG, power, fertilizer and industrial gas consumers, while allowing them the option to avail non-cash settlement against outstanding sales tax, subsidy and duty drawback receivable from the government of Pakistan. The development was majorly positive, especially for Fertilizer sector, except for select steel and cement players. However, HASCOL's disappointing results spooked out the positive sentiment of GIDC development.
Top performers during the week included GWLC (up 3.63 percent) and FFC (up 1.31 percent), while HASCOL (down 19.79 percent), PAEL (down 15.95 percent) and OGDC (down 14.49 percent) remained the worst performers.
"After a week of euphoria for the market, it was back to where we started as overall negativity cleaved most of the momentum off the KSE-100 Index, which closed down by 1,678 points", an analyst at JS Global Capital said. This week, there were a significantly higher number of news/events that dominated the market's momentum. The most prominent among them were the Kashmir dispute, a huge 8.9 percent Fiscal Deficit for FY19, compared to 6.6 percent in FY18 and IMF's expectations of 7 percent, government's intent to offload a portion of their stakes in PPL and OGDC and Royal Vopak planning to invest $2.8 billion in Pakistan (an outlier here, given that most other news are negative).
Other than this, there was some overhang from last week pertaining to the FATF news, whereas negative results such as HASCOL and the repercussions of this being a futures rollover week did not exactly aid the market's cause. There was some relief for the fertilizer players, following the government's decision to waive half the GIDC cess collected and reduce the future GIDC by half, he added.
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