Investors likely to remain sideways in short week

Stocks closed 1.62 percent higher during the last five sessions and first time surpassed 41,000 points mark, while there will be a mixed reaction with two religious holidays next week, dealers said.  

On the last two days of the last week, the market witnessed some profit-taking in the blue-chip stocks. However, the small- and medium-cap stocks still dominated the trade. During the mid-week, the market touched the all-time high of 41,447 points.

“Next week will be short due to Moharram holidays. We expect the investors to remain sideways,” said KASB Securities, in a report. “Range        bound trading with selective buying, primarily tracking institutional flows will continue to prevail in the market due to lack of triggers. Meanwhile, sideboard stocks are expected to drive volumes in the upcoming sessions.”

The benchmark KSE 100-share Index increased 1.62 percent or 658.67 points to 41,200.48 points as against 40,541.81 points in the last week.   

The average traded volume increased 14.5 percent, while average traded value rose 13.4 percent week on week. Foreign institutional portfolio investment recorded an outflow of $8.3 million as compared to an outflow of $8.6 million during the last week.  

Elixir Securities, in a report, said KSE 100-share Index surged 1.6 percent, gaining 659 points to close at 41,200 points during the outgoing week with banks (up 149 points) continuing to remain in limelight, while cements (up 123 points) and chemicals (up 131 points) made a comeback.

International oil prices are expected to edge up in the backdrop of recent the Organization of the Petroleum Exporting Countries’ supply cut agreement. 

“We believe expectations of interest rates bottoming out at the current levels have further firmed up,” said Elixir Securities.  Banking sector rose 1.4 percent, with UBL up 2.9 percent or 55 points) being the outperformer.

Faizan Ahmed, an analyst at JS Research said equities continued to rally amidst improving macroeconomic outlook and subsiding geopolitical concerns arising out of the recent conflict between India and Pakistan.

Increase in prices and activity was observed across the board. Cements rose 2.2 percent on decent first quarter off-take numbers. Fertiliser sector was up 1.9 percent with diminishing foreign selling and value buying.

Rally in low- and mid-market cap sectors, such as gas utilities (up 5.8 percent) and telecom (up 1.3 percent) also continued.

Major surprise came from the oil and gas sector as despite rebound in international oil prices, the sector underperformed the benchmark Index by 0.9 percent during the week.

Topline Securities, in a report, said important news of the week included foreign exchange reserves surging to an all-time high of $23.6 billion during the week ended September 30, following the inflows of the last tranche under the International Monetary Fund’s external fund facility program.

Moody’s Investors Service maintained its stable outlook on the Pakistan’s banking system, reflecting the rating agency’s expectation that the country’s banks would continue to benefit from a stable deposit base, high liquidity buffers and an accelerating economic growth.

Other important highlights of the week were issuance of $1 billion Sukuk at 5.5 percent. 

Among the individual stocks, Bank Of Punjab, Shell Pakistan, International Steel Limited, Sui Northern Gas Ltd and Kohinoor Textile were the major gainers, while Pak Services, Honda Atlas Car, Pak Suzuki Motors, Pakistan Petroleum, and Punjab Oil were the major losers.