The Pakistan Stock Market is likely to stay in green during the next week owing to the central bank’s decision to keep policy rate unchanged at 7 percent. Analysts at Arif Habib Limited hoped that the market to trade in green due to following reasons: the central bank keeping policy rate unchanged while also hinting at status quo stance in the near term, which is positive for the stock market; encouraging SBP projections as current account deficit is expected to remain below 1 percent of GDP for FY21; slowdown in Covid-19 infection ratio; and stable PKR/USD parity. However, once again bears took charge and negative sentiments were fuelled by announcement of current account deficit after five months, likely increase in electricity tariff by PKR 1.95/KwH (notification awaited), and CCoE’s proposal to discontinue natural gas supply for captive power generation. The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) is currently trading at a PER of 7.7x (2021) compared to Asia Pacific regional average of 17.7x while offering a dividend yield of ~6.4 percent versus ~2.6 percent offered by the region. This week trading commenced on a negative note due to worsening gas supply situation in the country which might result in suspension of gas supply to industries, decline in international crude prices (negative sentiment in E&P sector), and rising political pressure as PDM wanted to protest in front of Election Commission of Pakistan to probe foreign funding case. However, the index displayed a rebound on the next trading day and recovered lost points. Contribution to the downside was led by; oil and gas exploration companies (143 points), fertilizer (43 points), oil and gas marketing (33 points), automobile assembler (25 points), and pharmaceuticals (16 points). Scrip-wise major losers were PPL (65 points), OGDC (59 points), POL (59 points), ENGRO (31 points), and MCB (22 points). Whereas, scrip-wise major gainers were TRG (110 points), MARI (41 points), BAHL (34 points), KTML (29 points) and ICI (26 points). Foreigners accumulated stocks worth USD 5.51 million compared to a net sell of USD 2.10 million last week. Major buying was witnessed in Technology and Communication (USD 3.24 million) and Power Generation and Distribution (USD 2.43 million). On the local front, selling was reported by Mutual Funds (USD 19.90 million) followed by Broker Proprietary Trading (USD 7.46 million). That said, average daily volumes and traded value for the outgoing week were down by 25 percent and 9 percent to 510 million shares and USD 118 million, respectively.