Weekly Review: market likely to continue positive sentiments

Weekly Review: market likely to continue positive sentiments

KARACHI: Pakistan stocks likely to extend gains during next week on recent announcement of the International Monetary (IMF) regarding disbursement.

Analysts at Arif Habib Limited said that the market to remain in the green zone given hopes on loan disbursement from IMF once approval is granted by the Executive Board.

READ MORE: Pakistan stocks up 671 points on continuous rupee gain

Moreover, with the ongoing result season, certain sectors and scrips are expected to stay under the limelight given anticipation of robust results.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) is currently trading at a PER of 4.3x (2022) compared to Asia Pacific regional average of 12.5x while offering a dividend yield of 8.9 per cent versus 2.8 per cent offered by the region.

READ MORE: Pakistan stocks gain 357 points as rupee continues recovery

The market commenced on a negative note this week given inflation for the month of July 2022 came in at 24.9 per cent. Whereas, the sentiment turned positive after IMF announced that Pakistan had fulfilled the last remaining pre-requisite for the IMF loan (incremental hike in petroleum development levy on MS and HSD).

With this renewed hope, the Pak Rupee strengthened against greenback, gaining Rs15.33 | 6 per cent WoW to close at Rs224.04 this week.

Furthermore, trade deficit significantly declined in July 2022, down by 47 per cent MoM. Moreover, reduction in international oil prices post OPEC+ meeting (WTI trading below $88 per barrel compared to $98.62 per barrel last week) further cemented the ground for bulls.

READ MORE: Pakistan stocks up 877 points on massive rupee appreciation

Albeit, the local bourse closed at 42,096 points, gaining 1,946 points (up by 4.9 per cent) WoW.

Sector-wise positive contributions came from i) Banks (427 points), ii) Cement (421 points), iii) Fertilizer (112 points), iv) Chemical (111 points) and v) OMCs (106 points).

Whereas, sectors which contributed negatively were i) Close-End Mutual Fund (3 points) and ii) Real Estate Investment Trust (1 point). Scrip-wise positive contributors were LUCK (155 points), UBL (124 points), MCB (87 points), PSO (78 points) and COLG (73 points). Meanwhile, scrip-wise negative contribution came from FABL (10 points), MARI (6 points), ILP (4 points) and AICL (3 points).

READ MORE: Pakistan stocks end in green on rupee recovery

Foreigners selling was witnessed this week, clocking in at $0.69 million compared to a net buy of $0.57 million last week. Major selling was witnessed in Banks ($0.9 million) and Fertilizer ($0.6 million).

On the local front, buying was reported by Brokers Proprietary ($2.2 million) followed by Mutual Funds ($1.6 million). Average volumes clocked in at 263 million shares (up by 75 per cent WoW) while average value traded settled at $34 million (up by 56 per cent WoW).

READ MORE: Pakistan stocks end down 74 points