KARACHI: Bulls took over the stock market in the outgoing week after certainty returned to the political arena.
According to Arif Habib Ltd, the new coalition government has started working to tackle the serious problems facing the economy, which has led to positive momentum in the national stock market.
Additionally, the Rupee rallied against the Dollar at a rapid pace and closed at 181.4, marking a 3.6% appreciation. Moreover, the country received record remittances last month, with inflows amounting to $28.3 billion, up 28% on a monthly basis, thanks to the Ramazan/Eid factor.
Although there was a slight correction mid-week, the market maintained its momentum and posted its largest week-over-week increase since April 3, 2020. As a result, the stock market closed at 46,602, up 2,157 points or 4.9% from a week. from.
Sector-wise, positive contributions came from commercial banking (395 points), fertilizers 292 points, technology and communication (268 points), cement (241 points) and refinery (129 points) .
While the sectors that contributed negatively are real estate investment trusts (2.19 points), vanaspati and related industries (1.55 points).
Regarding certificates, positive contributions came from Engro Corporation Ltd (152 points), TRG Pakistan Ltd (136 points), Meezan Bank Ltd (122 points), Habib Bank Ltd (85 points) and Systems Ltd (80 points).
Meanwhile, negative contributors were Colgate-Palmolive Pakistan Ltd (14 points), Faysal Bank Ltd (10.88 points), Fatima Fertilizer Company Ltd (4.74 points), Allied Bank Ltd (3.18 points) and Dolmen City REIT (2.19 points).
Foreign purchases were seen over the past week as they amounted to $1.29 million compared to a net sale of $3.78 million the previous week. Large purchases were seen in technology ($2.21 million) and fertilizers ($1.16 million).
On the local front, sales were reported by mutual funds ($9.89 million) and insurance companies ($7.76 million). According to AKD Securities, the positive momentum will likely continue in the short term. The market is currently trading at a price/earnings multiple of 4.5, which is quite low considering its historical average. However, the political arena is also heating up with the PTI staging protests across the country, the brokerage added.
“While this remains largely a non-event from a stock market perspective, any escalation in tensions may negatively impact investor sentiment. Additionally, the earnings season is expected to pick up speed over the next coming week, where surprises cannot be ruled out to drive individual stock performance,” he added.
Posted in Dawn, April 17, 2022