KARACHI: Pakistan’s stock market likely to stay jittery on geopolitical tensions and rising commodity prices.
Analysts at Arif Habib Limited said that the market will remain jittery in the short term on account of geopolitical tensions and rising commodity prices.
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Key events to look out for include MPC meeting, FATF decision, and an ongoing IMF review which will have an impact on the market.
Keeping in view the ongoing result season, certain sectors and scrips are expected to stay under limelight.
The benchmark KSE-100 of Pakistan Stock Exchange (PSX) is currently trading at a PER of 5.0x (2022) compared to Asia Pacific regional average of 13.5x while offering a dividend yield of 8.8 per cent versus ~2.4 per cent offered by the region.
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The outgoing week commenced on a positive note as Russia and Ukraine entered negotiations, however things turned for the worse as talks broke down, which caused global crude oil prices to soar past $ 114/bbl.
Moreover, announcement of an industrial package triggered buying mid-week, albeit, the positive momentum could not sustain for long as the market plummeted over the noise of Russia’s military attack on Ukraine and rising commodity prices.
READ MORE: Stocks shed 289 points on high global commodity prices
Furthermore, the trade deficit rose to $ 32 billion, increasing 82 per cent during July – February 2021/2022 and inflation rose over 12 per cent YoY, which kept the index under pressure as well.
The market closed at 44,551 points, rising 567points (up by 1.2 per cent) WoW.
Sector-wise positive contributions came from i) Oil & Gas Exploration Companies (402 points), ii) Technology & Communication (129 points) iii) Fertilizer (95 points), iv) Chemical (24 points) and v) Power Generation & Distribution (19 points). Whereas, sectors which contributed negatively came from i) Cement (67 points), ii) Oil & Gas Marketing Companies (12 points), iii) Insurance (12 points), iv) Automobile Assembler (11 points), and v) Leather & Tanneries (8 points).
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Scrip-wise positive contributors were PPL (169 points), OGDC (136 points) TRG (117 points), POL (74) and EFERT (37 points). Meanwhile, scrip-wise negative contribution came from LUCK (39 points), MCB (34 points), PSO (18 points), DGKC (17 points) and DAWH (16 points).
Foreign selling continued this week, clocking-in at $ 0.97 million compared to a net sell of $ 3.24 million last week. Major selling was witnessed in E&P’s ($ 1.5 million) and Banks ($ 1.4 million). On the local front, buying was reported by Banks ($ 2.4 million) followed by Brokers ($ 2.1 million). Average volumes clocked-in at 215 million shares (down by 5 per cent WoW) while average value traded settled at $ 43 million (up by 12 per cent WoW).
