Daily Times

Due to investors’ continued optimism and favorable start to the week, the Pakistan Stock Exchange (PSE) was dominated by bulls this past week.

It was an encouraging start to the week for investors, as the government set its fiscal year 2023 budget deficit target at a lower level of 5pc.

The stock market, on the other hand, saw a decrease since many investors chose to stay away until the budget was announced. The rupee’s fall versus the US dollar and reports of higher levies proposed in the next budget shook the market even further. Investors’ confidence was shattered by the uncertainties surrounding the IMF’s lending program and the loss in foreign currency reserves.

However, investors’ optimism about the approaching budget announcement caused a turnaround in the situation, and the stock market went into a bullish phase. Bulls pushed the stock market to a weekly high of over 42,000 points.

According to a report from Topline Securities, the KSE-100 benchmark index increased by 1.7pc week over week. New taxes and reductions in subsidies in the FY23 budget are expected to pave the way for the IMF program, which is expected to make progress at the staff level by next week, according to Topline.

The average daily traded volume and value fell by 19pc and 27pc to 169.8m shares and Rs4.4b respectively as investors decided to remain on the sidelines prior to the FY23 budget declaration.

Foreign corporations, Pakistanis living abroad, and mutual funds all sold stock during the week, for a total of $3.78m, $2.52m, and $2.08m in net proceeds. Local corporations, on the other hand, absorbed the selling by purchasing stock worth a net $8.6m.

Pakistani stocks completed the week at 42,015, up 1.7pc week-on-week, according to JS Global.

According to the report, the market made some progress in recouping some of the losses from the previous week. The government budget for FY23, issued on June 10th, remained the major focus for investors.

There were some notable outliers in oil and gas, followed by the cement and chemical sectors; the underperformers included banks due to fears over the federal budget’s imposition of taxes.

Construction activity has slowed, which has resulted in lower cement sales, but textile exports have increased by 59pc year over year in May 2022.