The Pakistan Stock Exchange (PSX) is likely to continue with range-bound activity in the week starting today (Monday) after two successive weeks of lacklustre and range-bound performance. However, the factor of result seasons may keep the PSX away from plunging, which was witnessed on Friday last, and there is expectation that the market will remain in the green zone at the start of the week. However, analysts are divided over the behaviour of the market. Analysts at Arif Habib Limited expect the stock market will pick up pace next week. “The results season is about to commence and we think that cyclical sectors can once again attract the limelight on the back of robust economic activity,” they said. Moreover, oil prices have continued to remain downwards sticky with no outcome on the oil output increase, which could spur buying in E&P scrips. However, fears over the fourth wave of the Covid-19 pandemic could keep the sentiments under check. JS Global conducted a webinar last week to present the “Stock Market Monthly Outlook” which noted that the target of petroleum levy for the fiscal year 2021-22 and international rising oil prices are likely to continue pressuring the inflation numbers which will ultimately fuel the selling pressure across the local bourse. During the previous months, the market witnessed positive sentiments on the back of resumed economic activities after lifting the lockdown situation. However, the spread of new delta variant will likely take the economy towards widespread lockdowns which would keep the market consolidated. The benchmark KSE-100 Index index shed 0.25 percent, or 122.73 points, to close the week ended July 9, 2021 at 47,563.45 points. The KSE-30 shares index gained 0.05 percent, or 10.43 points, to close at 19,110.87 points. The overall activity on the bourse dampened during the last week, as average traded volumes declined 22 percent to 486 million shares/day, while the average value of traded securities settled at $107 million, down 1 percent. Foreign selling continued during the outgoing week, clocking-in at $5.2 million, compared with the net selling of $8.4 million last week. On the news front, the auto manufacturers slashed car prices across-the-board and announced to pass on the impact of the reduction in the federal excise duty to the customers. In the light of the rising international commodity prices, the local players increased the prices of rebars. Similarly, prices of DAP were also increased domestically to pass on the international surge in prices. Moreover, uncertainty over how the geopolitical scenario pans out with regard to the US exit from Afghanistan, and Pakistan’s crucial role in this, has also kept the sentiments jittery. Ali Zaidi at JS Global Capital said: “[The] foreign exchange reserves with the central bank jumped $1.1 billion to a multiyear high of $17.2 billion, reportedly due to flows from the World Bank and China. This does not reflect the $1 billion Eurobond that was floated this week.” With regard to the coronavirus, Federal Minister for Planning, Development and Special Initiatives Asad Umar warned that clear signs of the fourth wave had already begun to show with the spread of the new variants of the virus. The KSE-100 is currently trading at a PER of 6.8x (2021), compared with the Asia Pacific regional average of 16.2x, while offering a dividend yield of 6.9 per cent versus 2.3 per cent offered by the region.