April 23, 2022 (MLN): This week, domestic equities witnessed severe selling pressure, after peaking at 46,602 level on positive sentiments about the new government formed by the coalition parties.
However, as macroeconomic concerns resurfaced, the market has seen a downward correction with KSE-100 losing 1,049 points or down by 2.25% during the week and falling to the 45,553 points level. In USD terms, the index was down by 4.9% WoW.
The market commenced the week on a positive note, as investors welcomed the news of the Pakistan-IMF formal dialogue on the revival of EFF, to ease off pressure building on the FX reserves and address concerns with regard to the external funding gap.
However, the positive momentum couldn’t sustain for long over economic concerns such as PKR depreciation (closing the week at Rs186.70) and IMF program resumption.
Meanwhile, the increase in trade deficit widened to $3.6bn during Mar’22 further exerting pressure on the scrips. Furthermore, a downward revision of the growth target forecast to 4% by the World Bank and a rise in treasury bill yields by up to 70bps further suppressed the sentiment, a note by Arif Habib Limited said.
During the week, the bourse witnessed all five sessions in the favor of bear. The KSE-100 index oscillated between high and low of 46,970 & 45,505 levels, respectively, before settling the week at 45,553 levels.
From the sector-specific lens, Commercial banks, Cement, Technology, Power Generation & Distribution, and Miscellaneous kept the index in red territory as they snatched 396, 219, 100, 74, and 72 points from the index respectively.
Contrary to that, Oil & Gas Exploration Companies, Fertilizer, Chemical Textile Spinning, and Real Estate Investment Trust, during the week collectively contributed 152 points to the bourse.
Scrip-wise, HBL, BAHL, LUCK, SYS, and PSEL were the worst-performing stocks during the week as they took away 90, 85, 70, 66, and 66 points from the index respectively. whereas COLG, FABL, FATIMA ABL, and DCR added 199 points to the index.
Meanwhile, the KSE All Share market cap decreased by Rs149.3 billion or 1.93% over the week, being recorded at Rs7.6trillion as compared to a market cap of Rs7.75tr recorded last week.
Flow-wise, foreigners were the net sellers during the week, selling stocks worth $0.97mn compared to a net purchase of $1.3mn last week. Sector-wise, major selling was witnessed in Commercial Banks ($1.74mn) and Food and Personal Care Products ($0.14mn).
On the local side, the majority of the selling was reported by Mutual Funds, and Banks amounting to $6mn and $1.2mn, respectively. However, Individuals stood on the other side with net buying of $7mn.
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