KARACHI: Pakistan Stock Exchange remained under severe pressure during the outgoing week ended on December 20, 2024 due to heavy selling mainly by mutual funds and year-end profit taking by institutions.
The benchmark KSE-100 index plunged by 4,788.65 points on week-on-week basis and closed at 109,513.15 points.
Trading activities also remained low as average daily volumes on ready counter decreased by 15.5 percent to 1,151.57 million shares during this week as compared to previous week’s average of 1,362.86 million shares while average daily traded value on the ready counter declined by 5.7 percent to Rs 57.16 billion during this week against previous week’s Rs 60.60 billion.
BRIndex100 decreased by 375.87 points during this week to close at 11,726.51 points with average daily turnover of 994.642 million shares.
BRIndex30 declined by 1,582.62 points on week-on-week basis to close at 36,376.64 points with average daily trading volumes of 695.971 million shares.
The foreign investors also remained on the selling side and withdrew $11.583 million from the local equity market during this week. Total market capitalization declined by Rs 629 billion during this week to stand at Rs 13.958 trillion.
An analyst at JS Global Capital said that the KSE-100 experienced a roller coaster ride during the week, declining 4.2 percent WoW. The week, however, ended on a positive note on Friday. Selling pressure was predominantly driven by mutual funds.
State Bank of Pakistan cut policy rates by 200bps during the week, in line with expectations, bringing the rate down to 13 percent, a total decline of 900bps from its recent peak. Furthermore, Pakistan’s current account balance posted a 4th consecutive surplus of $729 million in November 2024 (highest monthly surplus in 10-years), taking the balance for 5MFY25 to $944 million.
An analyst at Arif Habib Limited said the week commenced on a positive note with the SBP announcing a 200 bps rate cut, reducing the policy rate to 13 percent. Additionally, the country reported its highest current account surplus in a decade, amounting to $729million in November 2024, a notable turnaround from the $148million deficit recorded in November 2023.
However, from Wednesday onward, the market experienced a significant downturn, with two consecutive historic single-day declines of 3,700 points on Wednesday and 4,800 points on Thursday, primarily driven by mutual fund redemptions and year-end profit-taking by institutional investors.
Despite this, the market showed signs of recovery on the final day, closing the index at 109,513 points. Meanwhile, PIB cut-off yields across various tenors decreased by 4-55 bps.
Sector-wise negative contributions came from Oil & Gas Exploration (1,305points), Fertilizer (1,119points), Cement (798points),Commercial banks (446points) and Technology & Communication (252points).
Meanwhile, the sectors that contributed positively were OMCs (113 points), Cable & Electrical Goods (72 points), and Power (57 points).
Scrip-wise negative contributors were MARI (966 points), LUCK (430 points), FFC (324 points), PPL (585 points), and ENGRO (309 points). Meanwhile, scrip-wise positive contributions came from PSO (229 points), HUBC (166 points), INDU (90 points), ATRL (85 points), and BAFL (77 points).
Foreigner selling continued during this week clocked in at $11.6 million compared to a net sell of $0.9 million last week. Major selling was witnessed in E&P’s ($5.5 million) followed by Banks ($4.3 million). On the local front, buying was reported by Individuals ($25.8 million) and banks/DFI’s ($10.5 million).
Copyright Business Recorder, 2024