Daily Times

KARACHI: Despite mounting tensions between India and Pakistan at the borders, the bulls remained active throughout the week with Pakistan Stock Exchange (PSX)-100 index bouncing back above 40000 level again went up by 1.9 percent.

PSX-100 index gained 760 points in the past week to close at 40,542 points with contribution to upside coming from various sectors. While market remained buoyant, heightened geopolitical tensions during the period kept the lid on the market performance.

The market started the week on a highly positive note driven by a relief rally as investors shrugged off concerns emanating from India-Pakistan tension. The later part of the week witnessed an erosion of gains seen earlier as India made tall claims of having conducted surgical strikes, which were later refuted by Pakistani officials. The constant tug of war between bulls and bears translated into the benchmark hovering within a narrow space of 600 points.

Sultan Mahmood of Habib Metro Financial Services said, ‘we expect the market to remain choppy in the near term as geopolitical tensions, noise in local politics and foreign selling being key concerns’.

Commercial banks contributed the most points to the index as central bank’s recently announced monetary policy had clear indications of interest rates bottoming out at current levels.

Other major performing sectors included automobiles while oil & gas sector rode on recovery in international oil prices with a possible agreement among Organization of the Petroleum Exporting Countries (OPEC) members for production cuts.

Foreigners were net sellers of $8.6 million during the week. Banks and Oil & Gas Exploration sectors witnessed net selling of $4.2 million and $2.9 million, respectively whereas net buying of $2.6 million was seen in cement sector. Average daily volumes for the outgoing week decreased 27% WoW to 528mn shares while average daily value fell 9% WoW to Rs15bn/US$144mn during the week.

‘We expect investor’s to remain watchful of a further escalation in war hysteria while Consumer Price Index (CPI) announcement over the weekend is expected to further firm up interest rate expectations going forward’, said an analyst at Elixir Research Department.