KSE-100 performance: Gains and Losses, a tale of two halves

November 01, 2019 (MLN): With the month of October coming to an end, a significantly improved performance of KSE-100 index has been observed. Although it is not so impressive as it was in last month i.e. September 2019, the month remained among the best months of the year for the market over the past decade.

During the month of October, KSE-100 index moved up by 2,125 points or 6.62% MoM and closed at 34, 204 points. To recall, in the month of September, KSE-100 index advanced by 2,407 points i.e. an improvement of 8.81%.

A bullish bar appeared with encouraging volume signalling bullish sentiments among the investors, as during the month all share market capitalization increase by 4.43% or PKR283.49 billion MoM.

Improving macroeconomic factors and a descending revision in T-bills and PIBs yields helped lift stocks in October. Moreover, Gov’t relaxation for traders on axle load and CNIC condition has helped to further uplift investor’s sentiment.

In the first half of the month, the index gained nearly 6.2% on account of the downward revision in T-bills and PIBS yields secondary and the stability in PKR against USD supported the market movement.

Later, in the second half,  the index remained flat on account of a conclusion of the FATF review in which Pakistan remained in the grey list till February 2020 and political uncertainties particularly a call of Azadi March by opposition parties, created uncertainties and kept the investors on sideline.

Among the industry sectors that moved higher in October, Commercial Banks emerged as a top performer as it contributed nearly 487 points to the index. This was followed by Oil & Gas Exploration companies (359 points), Fertilizer (270 points), Cement (211 points) and Oil & Gas Marketing Companies (187 points ).

On the other hand, Tobacco, Miscellaneous, Paper & Board, Glass & Ceramics and Automobile Assembler emerged as the top losers, as they cumulatively snatched nearly 113 points from the index.

Within the top-performing sectors, ENGRO, MARI, HBL, PSO and DAWH emerged as the blue chips as together, these companies gained over 763 points.

Among local market participants, investors’ net trading resulted in a net buying of USD 12.932 million during the month, amongst which, Individual investors emerged as the largest net buyers as they purchased net securities worth Rs.12.935 million. Whereas, Banks, Insurance companies and mutual funds were net sellers during the month with a net accumulated selling of USD 17.78 million.

On the contrary,  foreigners remained net sellers with foreign corporates more inclined towards net selling as they sold securities worth USD 23.1 million.

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