Weekly Review: market likely to stay range-bound

Weekly Review: market likely to stay range-bound

KARACHI: Pakistan stock market likely to stay range-bound during next week due to fewer days of trading because of Eid holidays.

Analysts at Arif Habib Limited said that the market to remain range-bound next week.

Since next week will be a short one (due to Eid), with three-day working days along with lack of any major triggers, the market activity is expected to remain subdued.

The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) is currently trading at a PER of 4.2x (2022) compared to Asia Pacific regional average of 11.9x while offering a dividend yield of 9.3 per cent versus 3.0 per cent offered by the region.

The market commenced on a negative note this week, amid concerns over the resumption of the IMF program.

Moreover, the Pak Rupee climbed up by Rs3.06 against the USD, closing the week at Rs207.91. In addition to this, the cement offtake reported a decline of 7.9 per cent YoY during FY22.

Whereas, MS and HSD sales during June 2022 witnessed a drop of 12 per cent and 16 per cent MoM, respectively.

Meanwhile, the reduction in Arab Light price by 4 per cent provided some respite to the investors and cushioned the overall dip. The market closed at 41,344 points, losing 286 points (down by 0.7 per cent) WoW.

Sector-wise negative contributions in the market came from i) Cement (97 points), ii) Fertilizer (57 points), iii) Commercial Banks (30 points), iv) Chemical (27 points) and v) Power Generation & Distribution (24 points).

Whereas, sectors which contributed positively were i) Technology & Communication (27 points), ii) Oil & Gas Marketing Companies (18 points), iii) Oil & Gas Exploration Companies (13 points), iv) Close-End Mutual Funds (4 points) and v) Real Estate Investment Trust (3 points). Scrip-wise negative contributors were LUCK (49 points), POL (39 points), EPCL (34 points), BAHL (33 points) and ENGRO (33 points).

Meanwhile, scrip-wise positive contribution came from OGDC (39 points), PPL (27 points), TRG (15 points), SNGP (14 points) and HBL (13 points).

Foreign buying was witnessed this week, clocking in at USD 1.63 million compared to a net buy of USD 1.52 million last week. Major buying was witnessed in all other sectors (USD 0.63 million) and technology (USD 0.56 million).

On the local front, selling was reported by mutual funds (USD 2.91 million) followed by banks (USD 2.20 million). Average volumes clocked in at 90 million shares (down by 55 per cent WoW) while average value traded settled at USD 15 million (down by 52 per cent WoW).