Weekly Review: investors to hope for successful IMF program

Weekly Review: investors to hope for successful IMF program

KARACHI: Investors of Pakistan stocks will remain hope a successful staff level agreement (SLA) under IMF program during the next week.

Analysts at Arif Habib Limited said that an assurance from ‘friendly countries’ to fund a balance of payments gap is the last hurdle in securing an IMF deal.

READ MORE: Equities shed 364 points as SLA delay disappoints investors

Therefore, materialization of said commitment from these countries will help put the IMF program back on track and aid the sentiment at the index.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) is currently trading at a PER of 3.9x (2023) compared to Asia Pac regional average of 11.6x while offering a dividend yield of 10.9 per cent versus 2.9 per cent offered by the region.

READ MORE: Pakistan stocks drop by 180 points in dull trading

In the outgoing week the stock market started out positively, as investors were anticipating developments on IMF program. However, the momentum was disturbed due to noise on the political front.

Meanwhile, growth was witnessed in workers’ remittances in February 2023 (up by 5 per cent) compared to January 2023 as the Pakistani Rupee continues to find its market determined value, depreciating against the dollar by PKR 0.94 | 0.93 per cent WoW, and closing the week at 281.71/dollar.

Moreover, the State Bank of Pakistan (SBP) SBP reserves slightly climbed up by $18 million to $4.3 billion. In addition, the government on Wednesday raised PKR 26.4 billion through Pakistan Investment Bonds (PIBs) against a target of PKR 100 billion.

READ MORE: Pakistan benchmark index gains 58 points in mixed trading

Albeit, the market closed at 41,330 points, losing 464 points (down by 1.11 per cent) WoW.

Sector-wise negative contributions came from i) Miscellaneous (197 points), ii) Technology (155 points), iii) Fertilizer (78 points), iv) Banks (43 points), and iv) Food & Personal Care (32 points).

Whereas, the sectors which contributed positively were i) Cement (49 points), ii) Glass & Ceramics (25 points), and iii) Insurance (16 points). Scrip-wise negative contributors were PSEL (196 points), SYS (133 points), POL (79 points), ENGRO (54 points) and BAHL (50 points). Meanwhile, scrip-wise positive contribution came from OGDC (48 points), DGKC (22 points), TGL (13 points), SEARL (13 points), and MLCF (12 points).

READ MORE: KSE-100 index ends firmer amid political instability

Foreigners selling continued during this week, clocking in at $5.0 million compared to a net sell of $2.9 million last week. Major selling was witnessed in Commercial Banks ($2.5 million) and Technology and Communication ($2.4 million).

On the local front, buying was reported by Companies ($15.8 million) followed by Individuals ($1.0 million). Average volumes arrived at 223 million shares (up by 7 per cent WoW) while average value traded settled at $29.0 million (up by 23 per cent WoW).