Summary Out of 5 trading sessions, first three sessions closed positive.
KARACHI (Dunya News) - Equities overcame three weeks losing streak which cumulatively dragged index by 8.6 percent but turned green in the outgoing week amid attractive valuation that enticed investors to make fresh entry in the market.
Benchmark index closed at 42,074 index level, gaining 451 points or 1.1 percent in outgoing week.
KSE-100 sector-wise performance shows that Commercial Banks pulled up the index by 212 points, mainly because of Moody’s reaffirms Credit profile as B3 stable.
Out of 5 trading sessions, first three sessions closed positive on back of smooth sailing of the budget and amnesty scheme from National Assembly, clarity on election timing (25th- 27th Jul’18) and Moody’s reaffirmation of Pakistan’s credit rating (B3, stable) played its part in giving comfort to investors. The week was not, however, without turbulence on the political front as the ruling party and the largest opposition party failed to reach consensus on interim set-up. Moreover the negativity in last two sessions persists on back of depleting foreign reserves and higher current account deficits issues, said an analyst from Spectrum Securities.
While the analyst from Topline Securities said that the auto sector has been consistently underperforming as Government has barred non-filers from buying a new car which is likely to hit sales of the assemblers.
Indus Motors has lost around 18 percent since budget announcement date, while Honda Motors and Pak Suzuki Motors lost 15 percent and 9 percent respectively.
During the week, foreigners were net sellers of 26.1 million dollars, while on the other hand, Insurance Companies, Other Organizations, and Banks were net buyers of 23.2 million dollars, USD7mn, and USD4.3mn respectively.
The coming week, according to an analyst from BMA Capital is likely to remain unexciting as future of political set-up post elections, concerns on macro front and resultant potential re-entry into IMF program loom over investor’s minds. Potential triggers for the market may include: (i) consensus on interim setup and (ii) loan and deposit inflows. The increase in discount rate by 50bps was broadly in-line with market consensus hence may draw mixed reaction.
(Details by Haris Zamir)
