Daily Times

The Pakistan Stock Exchange (PSX) witnessed another volatile session as yesterday’s bearish sentiment continued to haunt the market. In the last trading session of the week, indices changed directions throughout the day before ending in the green zone.

The bullish sentiment which persisted in the market since November, driving KSE-100 to cross 42,000 mark, has taken a hit, and from here on the market will keep a volatile outlook, and continue to shed points. Irfan Saeed, Senior vice president, BMA Capital Management, said bulls and bears will continue to battle to claim supremacy -but the bourse will continue its correction mode. He said heavy selling from mutual funds consistently since last two days, indicates dampening market sentiments. However, he added that the investors’ interest will remain upbeat amid attractive market valuation, specifically oil and Banking stocks. Rising international oil prices and expected results from the banking sector will keep the their stocks moving.

On Friday, the KSE-100 Index jumped by 399.05 points to touch its intraday at 41,054.42. However, failing to sustain its gains, the index dipped by 161.38 points and recorded its intraday low at 40,493.99. It finally settled higher by 177.62 points at 40,832.99. The KMI-30 Index swelled by 465.76 points to close at 65,875.09 while the KSE All Share Index gained 251.53 points, ending at 29,118 points. The advancers-to-decliners ratio was almost in equal proportion, with 155 advancers and 163 decliners.

The overall market volumes dropped to 180.46 million, while the traded value stood at $55.08 million. The market volume was led by Right Shares of Hascol Petroleum Limited followed by Fauji Foods Limited and Unity Foods Limited. The scripts exchanged 18.56 million, 14.17 million and 8.73 million shares, respectively.

Among the top traded sectors, the oil & gas marketing sector topped with 32.89 million in cumulative volumes, followed by cement sector (volume of 18.44 million) and food & personal care products sector (volume of 16.06 million).

Sectors propping up the index were Oil & Gas Exploration Companies with 134 points, Fertilizer with 27 points, Investment Banks with 26 points and Tobacco with 19 points. The most points added to the index was by Pakistan Petroleum Limited which contributed 63 points followed by Oil and Gas Development Company Limited with 41 points, Dawood Hercules Corporation Limited with 24 points, Pakistan Tobacco Company Limited with 19 points and Fauji Fertilizer Company with 18 points.

Sector wise, the index was let down by Commercial Banks with 38 points, Textile Composite with 18 points, Technology & Communication with 12 points, Oil & Gas Marketing Companies with 11 points and Pharmaceuticals with 5 points.

Meanwhile, Adviser to Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh has said that current account deficit is down by 72.6 per cent on a year-on-year in November 2019, whereas it was reduced by 73 per cent during the first five months of FY20 against the same period of last year.

The adviser said that during the last five months of the current fiscal year, the State Bank of Pakistan’s reserves have increased by $1.8 billion and there has been a reduction of $3 billion in foreign exchange swaps/forward liabilities increased foreign exchange buffer by $4.8 billion which provided further stability to the external account.

It is pertinent to mention that on December 13, the foreign currency reserves held by the State Bank of Pakistan (SBP) were recorded at $10,892.9 million, up by $1,659.3 million compared with $9,233.6 million in the previous week. Such levels were last seen in May 2018.

The overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $17,655.5 million. Net reserves held by banks amounted to $6,762.6 million.

In Asia, stock markets traded mixed as U.S. stock markets broke a new record, with positive news on the trade front boosting sentiment. Investors’ are closely monitoring new North American trade deal which was passed by the U.S.House of Representatives. The deal is expected to be approved by the Senate next year. The United States-Mexico-Canada Agreement replaces the North American Free Trade Agreement (NAFTA).

But Japanese autos took a tumble in response. The new deal included a requirement that 75% of auto parts come from North America, up from the previous 62.5% required by NAFTA.

While those rules are aimed at substantial increases in domestic production, that’s likely to hit automakers in Japan. Many Japanese automakers have production bases in Mexico. They manufacture cars and trucks in the North American nation for export, according to data from Mexico’s auto industry association AMIA.

The Shanghai composite fell 0.40% to close at 3,004.94, while the Shenzhen component declined 0.65% to 10,229.49.China on Friday left its new lending benchmark, the loan prime rate unchanged, as expected, after it kept rates of medium-term loans steady earlier this month. The central bank of China conducted lending facility operations twice this month, injecting over $85.61billion into the banking system to add stimulus into the economy. Earlier this week China’s PM Li Keqiang, said the economy could face downward pressure next year, confronted by slowing demand and as U-S trade tariffs still hurting its economy. China’s economic growth has slowed to near 30-year lows in the third quarter.

In South Korea, the Kospi bucked the regional trend, rising 0.35% to 2,204.18. Hong Kong’s Hang Seng closed 0,25% higher.

Japan’s Nikkei 225 followed the downward trend, dipping 0.20% to close at 23,816.63.The country’s core consumer inflation rose 0.5% in November from a year earlier, according to government data on Friday still far from its elusive 2% target. Japan’s auto sector tumbledas Toyota plunged 1.11%, Nissan lost 1.13%, while Mazda declined 0.83%, and Suzuki pared some losses to tumble 0.84%. Mitsubishi was down 1.04%.