Daily The Business

Capital market gains more than 1,400 points

KARACHI: The Pakistan Stock Exchange (PSX) during the preceding week recorded a gain of more than 1,400 points as the positive aura emanating from the Saudi package for the country’s economy and hopes of similar offering from China helped the index stay in green with average volume hit to 64-week high market.
Topline Securities report said that the average volume of 322 million shares reached a 64 weeks high as investors’ awaited for Prime Minister Imran Khan’s visit to China and hoping it would yield the same results as the Saudi Arabia trip, which helped the Index to add 12 percent in 8 consecutive sessions.
The KSE-100 Index closed on a nine-week high at 42,004, while this was also the first time since April 2018 that all five sessions of the week closed on a positive note. Foreigners were net sellers offloading positions worth $11.84mn in the first four sessions of the week. Commercial Banks and Cement sectors drove the market upwards during the week adding 812 points cumulatively, while on the other hand E&Ps chipped away 174 points.
The international crude prices continued downward trajectory on the back of waivers given to several countries on Iran sanctions, refuting supply constraints. This dragged the local E&P stocks under the hammer with MARI taking the biggest hit and losing four percent in a single session.
According to an analyst, several blue chips and investment stocks despite overall gain in the index muted because of the poor law and order situation in the country, which did not allow them to gain appreciably.
Amongst textile names, Nishtat Mills showed the most notable uptick in earnings reflecting a turnaround in fortunes for all export oriented textile plays. Stellar results in textiles are attributed to 1) improved energy availability, 2) weaker rupee giving traction to exports and 3) better cash flows as funds stuck in refunds and rebates with the GoP get released gradually, said an analyst from Habib Metrofinance Securities.
BMA Capital Management analyst said that the investors keenly await details of financial package by China, as Sep 18 result season is drawing to a close and high expectations are pinned on the PM’s visit to China.
The IMF program mission is set to visit Pakistan in the coming week to discuss a potential bailout package for the country that remains a key event for market participants, in our view. Moreover, above expected inflation print of seven percent in Oct 18 reinforces our stance of 100 basis points in upcoming Central bank s (bi-monthly) monetary policy review (due by end of Nov’18) that would likely rejuvenate investor s interest in banking space.—Agencies

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