Daily Times

It was a good week for Pakistan’s stock market, with the KSE-100 index closing the week at 42,075, up 1.8pc from the previous week.

An upbeat market mood persisted all week as investors welcomed news of a staff-level agreement between the government and the International Monetary Fund (IMF). Following the decision of the IMF Executive Board, a loan in the amount of $1.2b would be disbursed under the Extended Fund Facility. This was one factor that contributed to the index gaining 500 points. Investors cheered the return of the IMF loan program, despite the rupee’s continued fall against the US currency.

The KSE-100 index rose even higher when PM Shehbaz approved a significant cut in petroleum product prices, which delighted investors. However, profit-taking dragged the stock market down in the closing session, but the stock exchange managed to close the week on a positive note. This week, oil marketing businesses (+5pc WoW), engineering (+4.1pc), and cement (+3pc) were among the top achievers. International oil prices also remained turbulent, with Brent crude hitting a recent low of $94.78 per barrel (Sept contract) before completing the week at more than $100 per barrel. Brent crude Petrol and diesel prices were slashed in the country as a result of the fall in international oil prices. The 125bps hike in the State Bank’s policy rate in the previous week was overshadowed by all of these favourable developments. The index ended the week at 42,075 points, up 731 points (or 1.8pc). Cement, technology, and communication, as well as fertilizer and oil and gas exploration firms, all had a beneficial impact on the overall score (82 points).

Pharmaceuticals (22 points) and car assembly (21 points) were the two industries that had the most negative impact on the index (9 points). Positively impacting the stock market were Meezan Bank (84) and Systems Limited (70), Pakistan State Oil Company (53) and Lucky Cement (45) as well as Pakistan Petroleum (84). (39 points). However, Colgate-Palmolive Pakistan, Abbott Laboratories, Millat Tractors, Pakistan Oilfields, and EFU General Insurance all had a negative impact (9 points). There was a small amount of international buying this week, clocking in at $1.40m, compared to last week’s net purchase of $1.63m. There was a significant amount of buying in all other sectors (0.43) and banks (0.33). Banks and DFIs sold the most ($1.43m) in the region, followed by insurance companies ($1.13m). The average traded volume was 178m shares, up 97pc over the previous week, with a value of $31m (up 108pc WoW). On top of that, the SBP upped the markup rates on EFS and LTFF, K-E received a Rs9.52/unit pricing rise, and Morinaga Milk sought to enhance its share in NMPPL, and PIA entered the first of two Airbus 320 aircraft into its fleet.