Daily Times

Pakistan Stock Exchange (PSX) continued to witness a volatile trend amid lack of certainty and depth in the market. On Friday, Kse-100 succumbed to profit taking following previous session’s recovery, and lost 339.69 points by the session’s closing, to clock at 40, 731.61points.

During the session, the kse-100 index began its ascension, right after the opening bell, however failing to sustain the momentum, the index reversed its course, and entered the negative territory. During the session, despite early resistance KSE-100 Index remained in the red for almost the entire session, touching its intraday low at 40,679.61 after losing 391.69 points.

At kse-100, the index volumes decreased from 193.38 million shares recorded in the previous session to 185.32 million shares, while the overall market volumes were recorded at 350.44 million shares, slightly decreasing from the previous session’s volumes of 356.66 million shares. The volume chart was led by Unity Foods Limited, followed by Power Cement Limited and TRG Pakistan Limited. The scrips exchanged 49.04 million, 43.61 million and 31.3 million shares, respectively.

Sectors which dented the index were, Commercial Banks with 121 points, Oil & Gas Exploration Companies with 53 points, Fertilizer with 47 points, Cement with 35 points and Oil & Gas Marketing Companies with 27 points. Among the scrips, most points taken off the index were by Habib Bank Limited which stripped the index of 49 points followed by Muslim Commercial Bank with 32 points, ENGRO with 27 points, United Bank Limited with 26 points and Pakistan Petroleum Limited with 20 points.

However, the scrips which continued to resist the pressure at the index were Technology & Communication with 42 points, Vanaspati & Allied Industries with 7 points, Glass & Ceramics with 1 point and Cable & Electrical Goods with 1 point. Among the scrips, most points added to the index were by TRG Pakistan Limited which contributed 39 points followed by Meezan Bank Limited with 18 points, Colgate-Palmolive (Pakistan) Limited with 11 points, Unity Foods Limited with 7 points and Systems Limited with 6 points.

During the week, the market witnessed volatility, with index oscillating between negative and positive territory in every new session. During the week, the index climbed 844 points, which is a 2.1% WoW surge, in rebound from last week to conclude at 40,732 points.

Thee week opened on a bearish note with the index plunging by 775 points to reach its 3-week low of 31,112 points on Monday, meanwhile, investor participation also declined by 30%, as foreign investors continued to offload positions as the net sell clocked-in at $5.5 million. This selling was mainly absorbed by local individuals and insurance with inflows of $5.4mn and $3.6mn respectively.

According the closing report by BMA Capital Management Limited, “Fears over imposition of another lockdown by the government amidst surge in coronavirus infections kept the investor sentiments dampened. Currently, active COVID-19 cases in the country stand over 16,000 mark with average of 1,250 cases reported daily. Globally, several countries, mainly Europe have announced reimposition of lockdown as the second wave of the pandemic sent infections soaring to record levels. Additionally, the uncertainty around the outcome of US presidential elections aided the market volatility and triggered sell off in the emerging markets. Taking cues, crude oil prices slumped by around 2% over the last two days to USD 38.1 per barrel.”

However, investors’ confidence cemented over improving banks deposits, positive Current Account deficit strengthening Rupee and easing inflation. During the week, State Bank of Pakistan (SBP), stated that the banking sector deposits continue to show robust growth during the ongoing year, as the total deposits held by commercial banks clocked in at Rs 16.66 trillion by the end of October 2020, depicting a growth of 20% YoY and a decline on 1% MoM. According to the SBP’s data, cumulatively, during 10 month of fiscal year 2020, deposits have shown growth of 14%, which is highest in thirteen years. While, sentiments were also lifted, after Pakistan Bureau of Statistics revealed that the inflation during the month of October, eased slightly to 8.9% in October, from 9% in September on the back of a slight decline in prices of fresh fruits and vegetables.

Meanwhile, investors also continued to cheer the strengthening of Rupee against U.S dollars, which will remain a major performance indicator in the market. Cementing its position against the greenback, the Pakistani rupee climbed to six-month high for the first time since May 8, 2020, earlier this week, and continued to trade below 160 against the U.S. dollar. While, earlier in the week, advisor to Prime Minister on Commerce and Investment Abdul Razak Dawood, announced, Pakistan’s exports have crossed $2 billion in October 2020, despite the contraction in major markets and the uncertainty created by recent resurgence of the COVID-19 pandemic.