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KSE-100 INDEX CLIMBS ON FOREIGN BUYING AND FTSE, S&P INCLUSION OF PAKISTANI STOCKS
SUMMARY

The week ended higher and remained bullish on account of positive sentiments developed due to the foreign buying worth $27.66 million along with the news of FTSE, an international company specializing in index calculation is set to include five additional stocks from Pakistan in its Asia Pacific ex-Japan Index with effect from Sept. 18. The five companies to be added in The FTSE Global Equity Index Series Asia Pacific ex-Japan Regional Index, are MCB Bank, Sui Northern Gas Pipelines, Bank Alfalah, Millat Tractors and Thal Ltd. These companies are different from those upgraded by MSCI in June 1.

The first session of the week on Monday turns red amid thin volume. The Index shed 271.19 points to close at 41,126.83 .The volume declined to 94.919 million from 140.784 million on last session on Friday. The foreigner remained net seller of $0.23 million.

Stocks opened positive on Tuesday and hit an intraday high of 41,411.18 points. Lack of interest of investor with another thin but improved volume of 99.676m caused a slide of over 300 points later to close at 41,279.30 with a gain of 152.47 points. The bank sector was led by HBL (+5%).

It was bullish on Wednesday as Index gained 1,030.82 points to close at 42,310.12 Cement and E&P sector led the optimism. Volume too increased to 173.814m. The news of rebalancing of FTSE also increased the activity in the stocks. The volume increased to 217.12m.

The relief rally generated on Wednesday continued on Thursday and KSE-100 Index gained 371.45 points to close at 42,683.57m. The volume increased to 217.124 m.

Despite a volatile session on Friday, the Index moved forward by 103.62 on the back of upcoming FTSE and S&P rebalancing news that would see the inclusion of Pakistani companies in their emerging market indices. The volume, however, declined to 200m. Foreigners were net buyers of $7.77m.

 

PARTICIPANTS/ACTIVITY

On average shares of 382 companies were traded. Of these 169 were gainers and 190 were losers and 23 remained unchanged.

Foreigners were net buyers of $7.81m during the week; companies were net seller $7.81m, Banks were seller $6.73m; Mutual fund net seller$4.45m and individuals net seller $15.88m.

Volume leaders during the week were: World Telecom 56m; Azgard Nine 52m; Aisha Steel Mills 37m; TRG Pakistan 32m; B.O.P. 22m; Bank Alfalah 22m; K-Electric 17m; Jahangir Siddiqui & Dost Steel Mills 16m each; Engro Polymer 9m; Sui Southern Gas 8m and Pak Elektron 4m.

TRIGGERS
  • The FTSE is set to include five additional stocks from Pakistan in its Asia Pacific ex-Japan Index with effect from Sept 18.
  • Government rule out fresh IMF bailout.
  • ECC approved subsidized export of 0.5m tons of sugar.
  • Hasco Petroleum looking to raise Rs4 billion through right issue for expansion along CPEC.
CONCLUSION

Market expected inflows of around $500m on May 31 on MSCI upgrade of six companies but there was a net inflow of $82 million. In the present situation people eye gross foreign inflows up to $70m.Yet positive development is that FTSE includes five additional stocks from Pakistan.

RAEES UDDIN KHAN – Research & Development Institute of Securities Management & Research Karachi

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