Karachi, September 30, 2023 – The release of the latest inflation data for September 2023 is poised to influence sentiments in the Pakistan stock market as the new trading week commences on October 2, 2023.
Market analysts from Arif Habib Limited have emphasized the significance of closely monitoring the forthcoming inflation numbers for September 2023, which are expected to remain at elevated levels. Additionally, market participants will be keenly awaiting updates on the anticipated gas tariff adjustments.
READ MORE: Pakistan Stocks Decline by 132 Points in Subdued Trading
The benchmark KSE-100 index of the Pakistan Stock Exchange (PSX) is currently trading with a Price-to-Earnings Ratio (PER) of 3.6x (2024), a notable contrast to its five-year average of 5.7x. The market also offers an attractive dividend yield of 11.7 percent, compared to its five-year average of 6.8 percent.
During the past four trading days, the market displayed subdued activity, remaining relatively unchanged. Investors had been anticipating an increase in gas prices for the week, which ultimately did not materialize. This expectation, coupled with profit-taking activities, contributed to the overall muted performance of the market.
READ MORE: Pakistan Equities Gain 87 Points in Lackluster Trading
Furthermore, foreign investors saw a significant uptick in repatriation of profits and dividends from their investments in Pakistan, experiencing a sharp rise of 74.46 percent during the first two months of FY24. The Pakistani Rupee (PKR) settled at 287.74, appreciating by PKR 4.02, marking a 1.4 percent increase. Meanwhile, the reserves of the State Bank of Pakistan (SBP) decreased by USD 59 million, settling at USD 7.6 billion. The market concluded the week at 46,233 points, marking a decline of -189 points, equivalent to a -0.4 percent decrease week-on-week (WoW).
READ MORE: Pakistan Stock Market Ends Down by 116 Points in Range-Bound Trading
Sector-wise, negative contributions were observed from Technology & Communication (176 points), Commercial Banks (170 points), Automobile Assemblers (59 points), Fertilizer (34 points), and Investment Banks/Investment Companies/Securities Companies (30 points). On the positive side, sectors that made significant contributions included Cement (85 points), Oil and Gas Exploration Companies (52 points), and Power Generation & Distribution (46 points). Among individual stocks, negative contributors included SYS (166 points), HBL (111 points), MTL (61 points), UBL (47 points), and ENGRO (34 points). Conversely, positive contributions were seen from LUCK (43 points), HUBC (41 points), POL (40 points), ILP (22 points), and EFUG (22 points).
READ MORE: Pakistan Stock Market Records Slight Decline of 27 Points in Lackluster Trading
Foreign buying activity was observed during the week, amounting to USD 0.19 million compared to a net buy of USD 0.29 million in the previous week. Notable foreign buying was witnessed in Commercial Banks (USD 1.54 million) and Oil & Gas Marketing Companies (USD 0.22 million). On the domestic front, selling was reported by Banks/DFIs (USD 3.66 million), followed by Companies (USD 1.42 million). Average trading volumes increased by 46 percent WoW, reaching 203 million shares, while the average traded value settled at USD 23 million, also up by 46 percent WoW.
