Weekly Market Roundup

Equity Market

The KSE-100 index lost around 2,557 points during the week and closed 28,109-mark i.e. nearly 8.34% percent lower than the closing of the previous week.

‘Despite further monetary easing – SBP announced a policy rate cut of 150bps to 11%, taking the cumulative rate cut to 225bps CYTD -and announcement of PkR1.2tn stimulus package at the end of the first trading session, the market sentiment remained bearish’, AKD Equity Research said in its report.

Commercial Banks once again managed to incur the largest losses, as it lost nearly 749 points during the week, followed by E&P Companies, Cement and Fertilizer Sectors, which lost nearly 608, 255 and 156 points respectively.  Within the losing sectors, HBL, OGDC, UBL, ENGRO and LUCK made losses of 245 pts, 194 pts, 134 pts, 126 pts and 118 pts respectively.

Figures released by NCCPL showed that foreign investors dumped USD 13.6 million worth of stocks during the week with foreign corporates doing the bulk of the selling.

On the local front, Individual investor picked up USD 6.1 million worth of stocks, followed by USD 5 million of stocks purchased by Insurance companies.

Forex Market

PKR depreciated by 4.33% or Rs.6.865 against the dollar in the interbank, as the greenback was traded as high as 169.50 and quoted even higher at 170.50, before closing at 165.54 compared to 158.68 from a week ago.

The high volatility was caused by the incessant withdrawal of funds from the local markets by foreign investors via SCRA. According to the figures released by the State Bank of Pakistan, an outflow of $21.5 million foreign currency was recorded during the week from local debt market, with the majority of activity taking place in T-bills. Decline in forex reserves of the State Bank also exerted pressure on the local currency. 

10 day volatility increased from 7.93% to 15.08% during the week.

Money market

Secondary market yields continued to decline as the SBP cut the policy rate by 150 basis points, the second time in as many weeks as the MPC had already cut the rate by 75 basis points.

MTB auction conducted during the week saw interest in the 12 month t-bill as the market continued to expect interest rates to decline.

Yields for 3, 6 and 12 months came down by 126, 115 and 127 basis points while those for 3, 5 and 10 years decreased by 55, 47 and 48 bps.

The Pakistan Bureau of Statistics is expected to release Inflation numbers for march this week.

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