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KSE-100 INDEX FALLS ON UNEXCITING RESULTS WITH POLITICAL UNCERTAINTY

SUMMARY

The result week closely watched by the investors produced cold response from them on some unexciting results. OGDC (-0.93%)result for 1QFY where the company posted an EPS of Rs3.95 & announced cash payout of Rs1.75/share. NCPL (-0.90%) and NCL (-5%)announced their result for 1QFY18 with an EPS Rs2.44, and a loss of 0.40/share. The KSE-100 Index went down by 2.33 points to close at 41,105.41. The average volume too declined to 134.53 million to 184.63 million last week. The market capitalization decreased to Rs8.473 trillion from Rs8.62 trillion last week.

Market opened on Monday started in losing ways after three-day winning streak. The KSE-100 Index shed 604.35 points to close at 41,483.54. There was profit-taking on Monday. Cement led declines as investors booked profits after the recent gains in DG Khan Cement and Lucky Cement. Pioneer Cement earning announcement disappointed the investors.

Stocks continued their decline on Tuesday and KSE-100 Index lost 191.86 to close at 41,291.68. Nearly all sectors finished lower on lackluster trading. A rally was witnessed in the steel sector on back of NTC imposing anti-dumping duty on imported re-bars.

The trading hours were cut short by an hour and a half due to ‘technical issue ‘ on Wednesday. Market saw a recovery and stocks across key sectors giving small gains and supporting the index upward. Results of MCB (+0.9%) came a little higher than expectation. Attractive valuation of the KSE-100 index stocks led to positive sentiments. The index gained 303.64 to close at 41,595.32.

On Thursday, the stock market plunged by 185.83 points on the news of an accountability court issued arrest warrants for former prime minister Nawaz Sharif. Disappointing corporate results from Aisha Steel, Pak Elektron, Nishat Chunian and Crescent Steel created bearish sentiments in the market. The market closed at 41,105.46 points.

Bearish sentiments continued on Friday as all major sectors including cement, financial and fertilizer remained in the red throughout the day. The market lost 304.09 points to close at 41,105.41.

 

PARTICIPANTS/ACTIVITY

On average shares of 365 companies were traded. Of these 137 were gainers and 208 were losers and 20 remained unchanged.

Foreigners were net seller of $5.36m during the week; companies were net buyers $1.31m, Banks were buyers $2.83m; Mutual fund net seller $11.26m and individuals net buyer $16.35m.

Volume leaders during the week were: TRG Pakistan Ltd 52 m; Aisha Steel Mills 36m; Azgard Nine 35m; Pak Elektron 34m; Dost Steel Mills Ltd 32m; Engro Polymer 23m; Sui Northern Gas 20m; K-Electric 10 m; Bank of Punjab 8m and Power Cement 7m.

TRIGGERS:
  • Pakistan’s total liquid foreign exchange reserves amounted to $19.9 billion down$150.8 million from a week ago.
  • NEPRA on Tuesday approved Rs1.52 per unit increase in base tariff fee for all consumers Ex-Wapda distribution companies.
  • Start of subsidy disbursement by Ministry to fertilizer sector.
  • Imposition of fuel anti-dumping duty by NTC on imported steel products.
CONCLUSION

The RSI and the MACD have moved up supporting a positive view. The political noise will remain a concern.

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

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