KARACHI: Coronavirus fear to haunt the local bourses during next week as it has already dented the market badly in the outgoing week.
Analysts at Arif Habib Limited said that with the extension of global panic over coronavirus and its spill-over on markets, currencies and commodities alike, pressure on the benchmark KSE-100 index to sustain.
Albeit, topsy-turvy trend of the market on last day of the week suggests that recent correction has opened up valuations and select sectors may come under limelight.
The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) is currently trading at a PER of 6.6x (2020) compared to Asia Pac regional average of 11.4x and while offering DY of ~7.2 percent versus ~2.9 percent offered by the region.
Given the outbreak of Coronavirus across 40-odd countries with no signs of containment in sight, global equities and commodities (such as Oil) were quick to witness a rout.
Moreover, Moody’s report signaling an adverse impact on local Banks post Pakistan’s inclusion in the FATF’s Grey List, further eroded sentiments.
That said, Pakistan and IMF’s staff-level agreement on the second review under the $6 billion Extended Fund Facility (EFF) provided respite to the market.
The local equity bourse shed 2,266points (5.6 percent WoW) to close at 37,984 points, depicting the biggest weekly decline since 16th Jun 2017 in points.
Sector-wise negative contributions came from i) E&P (575 points) led by weakness in International oil prices, ii) Commercial Banks (531 points), iii) Fertilizer (278 points), iv) Power Generation & Distribution (233 points), and v) Oil and Gas Marketing Companies (191 points). Scrip-wise negative contributions were led by PPL (256 points), OGDC (194 points), HUBC (170 points), HBL (152 points), and ENGRO (103 points).
Foreign selling continued this week clocking-in at USD 22.5mn compared to a net sell of USD 8.6 million last week.
Selling was witnessed in Commercial Banks (USD 7.6 million) and E&P (USD 4.8 million). On the domestic front, major buying was reported by Insurance Companies (USD 25.3 million) and Banks / DFIs (USD 7.8 million).
Average Volumes settled at 174 million shares (up by 63 percent WoW) while average value traded clocked-in at USD 48 million (up by 54 percent WoW).
