Weekly Market Roundup

December 15, 2023 (MLN): The benchmark index of the Pakistan Stock Exchange (PSX) snapped its 10-week-long winning streak to close at 66,130, showing a decrease of 93.6 points or 0.14% WoW.

This comes after the index experienced a historical bullish run since September that lifted the index to record highs.

The long overdue correction can be attributed to over-leveraged positions in the market, coupled with profit-taking by investors after a prolonged rally.

Moreover, some market participants were also hoping for a slight rate cut, however, the Monetary Policy Committee (MPC) opted to maintain it at 22% in its latest meeting.

Meanwhile, the Pakistani Rupee (PKR) continued to show strength during the week, extending its winning streak for the fifth consecutive week.

In USD terms, the index gained 0.08% this week on the back of stronger PKR.

Throughout the week, KSE-100 oscillated in a range of 2,667 points, between high and low of 67,094 and 64,427 levels, respectively, before settling the week at 66,130.

The market turnover remained high throughout the week, with an average traded volume of 630 million shares worth Rs22.48 billion changing hands, marking an increase of 9.52% MoM in the number of shares while a decrease of 10.54% MoM in traded value.

Moreover, the overall PSX average traded volume (All-Share) was recorded at 1.25 billion shares worth Rs30.34bn, marking an increase of 22.24% MoM in the number of shares while a decrease of 9.74% MoM in traded value.

This implies increased activity in smaller stocks like WTL, KEL, KOSM, etc. during the week.

Top Index Movers

From the sector-specific lens, commercial banks that were the top gainers last week turned into top losers this week, as they took away 641.6 points from the index.

This was followed by Food & Personal Care Products, Miscellaneous, Textile Composite, and Leather & Tanneries as they kept the index in negative territory by taking away 71, 54, 47, and 35 points, respectively.

Contrary to that, Oil & Gas Exploration Companies, Fertilizer, Cable & Electrical Goods, Automobile Assembler, and Transport remained green, as they added 363, 291, 61.5, 61.5, and 45 points to the index.

Scrip-wise, MEBL, UBL, BAHL, HUBC, and HBL were the worst-performing stocks during the week as they took away 219, 173, 114, 91, and 84 points from the index respectively.

Whereas, PPL, FFC, PTC, SNGP, and BOP collectively added 572 points to the index.

FIPI/LIPI

Flow-wise, the dominant buyers during the week were foreign corporates, with a significant net investment of $12.55m.

They allocated the majority of their capital, $2.5m, to Cement sector, while divesting from the Oil and Gas Exploration Companies, amounting to $0.33m in sales.

Foreign investors have remained net buyers for the sixth consecutive week, reflecting restored confidence in the market.

On the other hand, the leading sellers were Insurance companies, with a net sale of $5.65m.

Their most substantial sales activity was in the commercial banks, amounting to $4.73m.

To note, the local stock market has been on a bullish streak amid hopes of improved economic conditions following the expected inflows from IMF and friendly countries, relatively stable currency amid government-backed administrative efforts, and a possible slash in the interest rates.

Analysts expect this trend to continue in 2024 owing to robust earnings growth, attractive valuation, and steady economic growth.

The KSE-100 has gained 24,677 points or 59.53% during the fiscal year, whereas the ongoing calendar year has witnessed a cumulative increase of 25,710 points, equivalent to 63.61%.

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