Karachi, July 13, 2019: During the week KSE-100 index declined by 518 points (1.51 percent WoW) and closed at 33,672 points index level. Imposition of huge taxes, crackdown against Benami properties, dispute between government and business community about taxes and further hike in the RLNG prices by 4 percent, these all elements have their negative consolidated impact on the market.
According to Spectrum Research Commercial Banks lost most points followed by Power Generation & Distribution and Automobile Assembler. Commercial banks abate the index by 81 points, Power Generation & Distribution declined by 77 points and Automobile Assembler dropped by 53 points as taxes and duties had an impact on car sales which
dropped by 13 percent YoY.
Average volume during the week of KSE-ALL declined by 41 percent WoW to 51.06 million and the average volume of KSE-100 fell by 45.1 percent WoW to 37.6 million. whereas, KEL, MLCF & LOTCHEM topped the volume charts with 4.03 million, 3.9 million and 2.6 million respectively.
Sector wise market capitalization also showing decline of 1.5 percent WoW
to USD 42.9 billion. Food, Refinery and Automobile Ass are key sectors contributed 8.7 percent WoW, & 7 percent Wow and 5.7 percent WoW.
During the week, foreigners were the net buyers USD 5.908 million. The major buying was observed in cement and Cements, POWER. Oil & Gas MKT. On the local side companies (USD 7.626 million) and mutual funds (USD 5.264 million) were remained the seller.
On the economic front, the Asian development bank announced that they are planning to lend Pakistan USD 10 billion for various development project. Pakistan will receive USD 1.65 billion net receipts out of USD 6 billion from IMF Fund Program in 4 years.
SBP foreign exchange reserves declined by USD 190 million and other banks foreign reserves increased by USD 5 million, in total other banks and SBP foreign reserves stand at USD 7.175 billion and USD 7.083 billion respectively.
RLNG prices raised by government up to 4 percent and electricity prices will be hiked quarterly according to the IMF agreement. Inflation up by 0.83 percent (WoW).
FBR is going to launch automation process to facilitate the importers of raw material. State bank is going to announce new monetary policy on July 16th 2019. According to the indications of current economic condition, there is an expectation of increase in policy rate.
expecting capital market to remain subdued on concern related to political and economic uncertainty. The rising tussle between government on senate chairmen and deputy chairman on no- confidence motion along with traders’ strike also exerting pressure on the market.
Moreover, expected hike in interest rate in upcoming Monetary Policy Meeting would also hamper the Index movement.