Daily Times

With Russia-Ukraine tensions rising and oil prices skyrocketing, the country’s stock market had a turbulent week. As a result, the KSE-100 fell 404 points or 0.9 percent to settle at 45,676 points.

The Ukraine-Russia crisis was a major contributor to this week’s negative trend. A further Rs12.03 per litre rise in the price of fuel also included the impact of the increased petroleum levy (Rs4).

The KSE-100 index fell sharply in early trading on Monday as investors fretted over the possibility of a confrontation between Russia and Ukraine, sending global oil prices surging. As a result of the oncoming crisis, panic selling was observed on worldwide stock markets, and the ripple effect was felt on the local exchange.

To protect their positions, investors sold off their stock holdings as the global economy began to decline. On the other hand, the country’s political uncertainty further hampered the trading ecology. As international tensions subsided, the market was able to post a comeback the following session and take a breather.

The government’s historic hike in the price of petroleum items prompted bears to return to the bourse midweek and drive it roughly 300 points lower over two days. Fueled by the rise in global oil prices, the country’s leadership jacked up the price of gasoline and diesel, causing investors’ faith in the economy to suffer.

Traders were encouraged to unload their positions as the sharp rise raised concerns about inflation and further diminished people’s purchasing power. The index’s decline was accelerated by disappointing earnings reports from well-known publicly traded corporations, which fell significantly short of market expectations.

The final trading day of the week saw the market post gains, fueled by the passage of a measure that would have implemented the weighted average cost of gas (Wacog) across the country. The initiative was welcomed by the market because it is expected to help stabilise gas prices and entice new buyers.

According to a report from Arif Habib Limited, “we expect the market to stay bullish in the following week.” Two massive gas pipeline projects are on Prime Minister Imran Khan’s agenda for his upcoming trip to Moscow, which is scheduled for next week. A commercial arrangement signed during this trip is expected to be a major catalyst.”

At 191 million shares and $30 million, the average daily volume and value of trading decreased by 8 percent and 36 percent, respectively, in the week ending September 30, 2014. On the other hand, the industries that contributed favourably were automotive assembly (9 points), chemical (9 points), and oil and gas exploration (9 points)’ (5 points).

Hubco had 67 points, Engro 62, Meezan Bank 36, Systems Limited 35, and Dawood Hercules 28. (34 points).

Engro Fertilizer (55 points), Sui Northern Gas Pipelines (24 points), and Millat Tractors (22 points) were the scrip-wise positive contributors (22 points).

In the previous week, foreign selling totaled $1.97 million, compared to a net sell of $5.9 million in the previous week. Technology ($1.5 million) and commercial banks ($0.5 million) had significant sales.

First came bank purchases ($4.9 million), followed by private sales of $2.4 million in local sales. Additionally, the price of petrol was raised by Rs12 per litre, the ECC approved urea import cost estimates, January textile group exports fell 4.38 percent to $1.55 billion month-on-month, and foreign exchange reserves fell by $231 million.

Agencies add: After snapping a three-week winning streak by shedding over 400 points last week, Pakistan Stock Exchange (PSX) seems on a bumpy ride amid rollover week, political uncertainty and the Financial Action Task Force (FATF) plenary session starting from February 21.

Pakistan will once again present its case before the FATF when the body holds its plenary session in Paris from 21 February to 4 March 2022. The main effort will be to convince the FATF that it has delivered on all the high-level commitments it had made, not just in terms of tightening the domestic laws and regulations but also in terms of successfully prosecuting and punishing people involved in money laundering and terror financing. If Pakistan is removed from the grey list, this will surely help PSX surpass at least 47,000 points level.