KARACHI: Pakistan Stock Exchange remained under pressure during the outgoing week ended on May 27, 2022 due to selling on investor concerns over prevailing economic and political uncertainty in the country.
The benchmark KSE-100 index declined by 239.26 points on week-on-week basis and closed at 42,861.45 points. Trading activities however improved as average daily volumes on ready counter increased by 27.1 percent to 280.70 million shares as compared to previous week’s average of 220.84 million shares while average daily traded value on the futures counter increased by 28.1 percent to Rs 7.92 billion.
BRIndex100 lost 7.4 points during this week to close at 4,272.69 points with average daily turnover of 258.508 million shares.
BRIndex30 closed at 15,569.33 points, up 668.25 points with average daily trading volumes of 191.439 million shares.
The foreign investors remained net sellers of shares worth $1.5 million during this week as compared to a net sell of $6.1 million in previous week. Total market capitalization declined by Rs 20 billion during this week and stood at Rs 7.123 trillion.
Stocks jump after govt scraps fuel price freeze
An analyst at JS Global Capital said that Pakistan equities closed a volatile week on a negative note at 42,861 level, reporting a 0.6 percent decline on week-on-week basis. However, a recovery trend, which did not suffice to recover the early week losses, was witnessed in the last two trading sessions owing to some political clarity, statement released by the IMF and announcement of partial increase in fuel prices (up Rs 30/liter). The PKR also continued to depreciate reaching new lows, before reporting slight correction on the last trading session of the week.
Among the out performers were Refinery, Technology and OMC sectors. The Fertilizer Sector was among key underperformers this week as the government announced to fix the price for Urea at a maximum price of Rs 1,768/bag requiring fertilizer companies to reverse price increases made in the last 2 months. Other underperformers included E&P and Cement sectors.
Cut off yields showed an increase of 24-70bp as compared to the previous cut-off during the PIB auction held this week. Moreover, SBP reserves remained flat, clocking in at $10.1 billion.
An analyst at Arif Habib Limited said that in the outgoing week the market opened on a negative note, due to uncertainty over the outcome of the IMF program and the MPC meeting where the SBP decided to hike the policy rate by 150bps. Consequently, this put pressure on the rupee which hit an all-time low of PKR 202/USD.
On the political front tensions were high as PTI marched toward the capital, adding more pressure to the market. However, things turned for the better when the ex-PM Imran Khan decided to come back after 6 days.
Investor confidence was revived towards the end of the week when the government decided to hike petroleum prices by Rs 30/liter, paving the way for the resumption of the IMF program and other avenues of foreign funding. In other news, Saudi Arabia is in the final stages of extending the USD 3bn deposit to Pakistan, and ADB is set to fund projects worth USD 2bn.
Sector-wise negative contributions came from fertilizer (down 132 points), commercial banks (down 76 points), cement (down 56 points), oil & gas exploration companies (down 41 points) and power generation & distribution (down 29 points). Whereas, sectors which contributed positively were technology & communication (up 66 points), refinery (up 40 points), automobile assembler (up 32 points), oil & gas marketing companies (up 15 points) and food & personal care products (up 14 points).
Scrip-wise negative contributors were FFC (down 63 points), EFERT (down 57 points), LUCK (down 48 points), HUBC (down 39 points) and OGDC (down 30 points). Meanwhile, scrip-wise positive contribution came from TRG (up 64 points), MTL (up 34 points), HBL (up 30 points), AVN (up 23 points) and CNERGY (up 19 points).
Foreign selling was witnessed this week, clocking in at $1.5 million compared to a net sell of $6.1 million last week. Major selling was witnessed in Cement ($1.8 million) and banks ($1.4 million). On the local front, buying was reported by individuals ($11.0 million) followed by Brokers Proprietary Trading ($2.9 million).
Copyright Business Recorder, 2022