Maroc - EURASIAREVIEW.COM - A la une - 06/Aug 19:05

Pakistan Stock Exchange Daily Trading Volume Slips To 18 Month Low – OpEd

The Pakistan Stock Exchange experienced volatility throughout the week ended on August 02, 2024 due to political upheaval, with the average daily traded volume falling to 337 million shares as against 358 million shares a week ago, down 5.9%WoW, marking a low of 18 weeks. The benchmark index closed with a loss of 196 points or 0.25%WoW, to close at 78,226 points on Friday. Despite the 100bps cut announced in policy rate by the central bank on Monday, market sentiment remained skeptical. Trade deficit for July 2024 was reported at US$1.95 billion, down 19%MoM. The assassination of a prominent Hamas leader plunged the region into uncertainty, driving volatility in oil prices globally. In a noteworthy development, the Consumer Price Index (CPI) for July was reported at 11.1%, marking its lowest level in 33 months. China approved the conversion of three coal-fired power plants from imported coal to local coal, however no positive progress was reported on re-profiling of energy debt. Punjab Government raised royalty rates for cement manufacturers, which may result in a further increase in cement price to the tone of PKR50/bag. OMC offtakes declined to 1.2 million tons, down 17%MoM. MS and HSD fuel prices were decreased by PKR6.17/ and PKR10.86 per liter, respectively, in the latest fortnightly review. Foreign exchange reserves held by State Bank of Pakistan (SBP) reserves increased by US$75 million on a weekly basis to US$9.1 billion as at July 26. PKR largely remained flat against the greenback throughout the week to close at 278.5/ US$ on Friday. Other major news flow during the week included 1) Fitch upgrades Pakistan’s rating to ‘CCC’ Plys, 2) Competitive wholesale electricity market under CTBCM on the cards, 3) Privatization Board okays PIA and DISCOs sale, 4) Pakistan reports primary surplus in FY24 after gap of 20 years and 5) GoP mulls ending free electricity for public sector. Textile Spinning, Refinery and Automobile Assembler were amongst the top performers, while Leasing, Vanaspati & Allied Industries and Sugar & Allied industries were amongst the worst performers. Major selling was recorded by foreigners with a net sell of US$2.23 million. Insurance companies and Individuals absorbed most of the selling with a net buy of US$1.78 million and US$1.47 million. Top performing scrips of the week were: FFC, CNERGY, MUREB, ATRL and NCPL, while top laggards included: KOHC, BAFL, PIOC, DGKC and PGLC. Going forward, recently announced rate cut alongside improvement in credit ratings by int’l agencies should boost investor’s confidence. Additionally, the anticipated approval from the IMF executive board by the end of this month is likely to support bullish momentum. Sectors benefiting from monetary easing and structural reforms would remain in the limelight. However, modest economic recovery would keep the upside in check for the cyclicals.