Daily Times

Pakistan equities closed weekend session on bullish note as the uncertainty related to Avenfield reference cleared with the NAB court verdict. The benchmark KSE 100 index closed 45 points higher at 40284 level on Friday.

The stock market has started off FY19 on a disappointing note primarily due to increased political noise ahead of NAB Court verdict on the Avenfield corruption reference against Nawaz Sharif and Marium Nawaz announced today, 6th July, 2018, just ahead of session close. In the last 5-trading sessions, the market has cumulatively declined by 1,626 points to 40,284 level, a percentage decrease of 3.9 percent WoW.

‘Stocks closed higher on easing political uncertainty after former PM verdict announcement by the accountability court. Higher global crude prices, reports of record foreign receipts on account of Tax amnesty scheme and speculations on outcome of SC directions to the Govt to consider revision in local POL prices played a catalyst role in higher close at PSX”, commented Ahsan Mehanti, senior stock market analyst.

National Accountability Bureau (NAB) has announced the much awaited verdict on one of Panama’s on-going corruption references (Avenfield which pertains to the purchase of four flats in Park Lane, London) against the former Prime Minister Nawaz Sharif and his family.

In its decision, NAB indicts Nawaz Sharif and his daughter where the anti-graft watchdog announced 10-Year imprisonment for Nawaz Sharif (with 8 million pounds fine) and for Maryam Nawaz (with 2 million pounds fine), 7-Year imprisonment. The court has also announced to confiscate the Avenfield property in favor of Federal Government.

“Unless Nawaz Sharif and his family come back to Pakistan and face the announced charges, today’s judgment will likely dent PML-N’s popularity, we believe”, analyst at Topline Securities commented.

On Friday, along with increased political noise, lower than expected inflows under Amnesty scheme & external account concerns kept market under pressure.

Oil & Gas Exploration Companies, Commercial Banks and Cements dented the market performance the most, taking off 728 points from the KSE-100 index cumulatively.

Foreigners continued to remain net sellers during the week, wherein, net selling amounted to US$8.7 million. On the local front, mutual funds were net sellers of US$18.6mn whereas individuals were net buyers of US$9.3 million.

Analysts believe that moving forward bounce back in market will be expected as political ambiguities unfold after the verdict.

Published in Daily Times, July 7^th 2018.