Summary Pakistan to pay back $1.129 billion next week on maturity of 5-year international bond
LAHORE (Web desk) - The preceding week saw strong tussle between buyers and sellers as both acted on the development on the economic fronts- economy to perform dismal projected by the IMF depressed the tone, however support arrive at the fag following developments the government directed state-run institutions to support sagging bourse help turn table.
According to an analyst from a leading brokerage house low GDP forecast by the IMF and cement price cut mid-week in North and South ruined market sentiment initially, growth in remittances, positive outcome of the Finance Minister’s meeting with World Bank and IMF in the US, anticipation of another Amnesty Scheme together with talks of cement price restoration by cement manufacturers, revived the color of the market.
The market during the week fell below three year low but there has been general believe that since couple of occasions the market has been getting support around 36750 levels. During the outgoing week the market winds blew in all directions, with the benchmark KSE-100 index closing in green on 3/5 days and ending the week with a drop of 184 points or 0.5 percent to close at 37,338 points.
Activity improved slightly this week with a daily average volume of 148 million shares compared to an average volume of 119 million shares traded daily last week. Foreign investors remained net sellers during the outgoing week offloading positions worth $2.1 million.
This was mainly concentrated in banks and power. On the other side, cements witnessed the bulk of inflows. Amongst domestic investors, banks provided $4.3mn and companies $4.3 million provided most of the liquidity on the buying side.
Moreover, the Pharma sector took a beating and lost nearly 1.9 percent during the outgoing week as the government initiated a crackdown against increase in medicine prices during the week.
Other key news during the week were
(1) the government reviews FBR proposal for Rs 729 billion additional taxes for budget FY20,
(2) Pakistan to pay back $1.129 billion next week on maturity of 5-year international bond,
(3) World Bank and IMF share Pakistan economy s forecast with lower growth and higher inflation expectations,
(4) amnesty scheme to be launched later this month,
(5) SBP reserves fall by $220 million to $10.27 billion and
(6) auto sales for Mar-2019 report 2 percent growth.
“We expect outcomes of finance minister’s meeting with officials of IMF and World Bank will decide the direction of the index in the upcoming week”, said an analyst from Ismail Iqbal ecurities0. An analyst from BMA Capital Management said that the upcoming week should see the result season in full swing and is likely to dictate market sentiments. Key development to look out for next week is Pakistan’s third compliance report submission to Financial Action Task Force (FATF) to be taken up for review in May. Moreover, the market is likely to keenly track developments on IMF program.
Details by Haris Zamir
