Weekly Review: market likely maintain buoyancy

Weekly Review: market likely maintain buoyancy

KARACHI: The stock market likely to maintain upward trend as many corporate entities set to declare better results.

Analysts at Arif Habib said that with commencement of the result season certain sectors / scrips may come under limelight in the upcoming week.

Although pre-Eid jitters cannot be ruled out amid profit-taking at current levels. However, funds continue to flow in the bourse and economic activity shows signs of revival.

Hence, our long term stance on the market remains positive.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) is currently trading at a PER of 6.9x (2021) compared to Asia Pac regional average of 13.1x and while offering DY of ~6.7 percent versus ~2.7 percent offered by the region.

The outgoing session marks end of a fifth consecutive positive week at the KSE-100 index.

Although the rally lost stream mid-week amid profit taking and selling pressure from individuals, the bourse moved up 276 points WoW to close at 37,608points.

To recall, sentiments have been rejoiced by several rate cuts by the SBP (625bps in total) which have once again brought equities to the forefront as the preferred asset class, while improvement in the domestic COVID-19 recovery rate, end of lockdown as well as reinstatement of pre-corona market hours aided volumes and attracted investment in the market.

Sector-wise positive contributions came from i) Commercial Banks (253 points), ii) Power generation and distribution (76 points), iii) Automobile Assembler (31 points), iv) Textile composite (28 points), and v) Technology and communication (17 points).

Whereas negative contributions came from i) Cements (60 points), Oil & Gas Exploration Companies (38 points), and Chemical (19 points). Scrip-wise positive contributions were led by HBL (128 points), MCB (64 points), HUBC (58 points), BAHL (35 points), and MTL (31 points).

Foreign selling continued this week clocking-in at USD 9.3 million compared to a net sell of USD 27.4 million last week.

Selling was witnessed in Commercial Banks (USD 2.9 million) and E&P (USD 1.7 million). On the domestic front, major buying was reported by Companies (USD 7.3 million and Insurance Companies (USD 7.0 million).

Average volumes settled at 413 million shares (down by 3 percent WoW) while average value traded clocked-in at USD 97 million (down by 2 percent WoW).

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