KARACHI: The stock market remained range-bound in the early sessions of the week, but investor interest in index heavyweights, mainly in the banking sector, helped propel the KSE-100 index to a record high of 39,528 points, representing gains of 377 points (0.96 per cent) during the week.

Intermarket Securities calculated for the month of July, the KSE-100 index saw an addition of 1,745 points with major contributions coming from HBL, LUCK, HUBC, PSO and DGKC which added 834 points collectively while downward pressure came from FML, EFOODS and OGDC which took away 218 points in total.

“For the outgoing week, selective buying remained the key theme in the market, leading to a slight increase in the index of 1pc. The two conflicting events of result season and roll-over week kept the market in check,” stated analysts at KASB Securities.

Average daily volumes at the PSX declined by 2pc to 182.8 million shares, while average daily values fell 21pc to Rs10.5 billion. During the week foreign investors were net buyers of shares worth $10.9m.

“Oil & gas marketing attracted foreign interest with net buying of $6.7m, whereas, chemicals saw a net outflow of $8.6m”, noted dealers at Topline Securities.

Among major sectors, tobacco, cement and oil and gas marketing companies were up 6.3pc, 3.2pc and 2.6pc, respectively. On the contrary, oil and gas exploration, refinery and pharmaceuticals were down, 4.5pc, 1.9pc and 1.4pc, respectively. Fertiliser stocks remained flat during the week while the sugar industry unveiled robust results this season.

Sindh Abadgar Sugar Mills, Faran Sugar Mills and Mirpurkhas Sugar Mills recorded hefty earnings. Concerns over the global supply glut eroded oil (Brent) prices by 7.7pc during the week leading to a bearish spell in the E&P sector with OGDC, PPL and POL pushing the market down 80, 70 and 60 points respectively.

According to AKD Securities, leading gainers during the week were SHELL which gained 7.19pc, NCL up 6.91pc, Lucky Cement up 5.15pc, NML up 5.11pc and ABL up 2.62pc; while laggards included POL down 7.74pc, PSMC down 7.31pc, PPL down 4.64pc, OGDC down 4.60pc and EPCL down 2.74pc. Volume leaders were DCL with 60.95m shares, AGL with 51.91m shares, SNGP with 51.36m shares, DFML with 40.87m shares and TRG with 38.95m shares.

Outlook: Analysts reckoned that the direction of the market in the next term would be dictated by announcements of corporate results and the trajectory of foreign flows. The KSE-100 index is currently trading at a price-to-earnings (P/E) ratio of 9.5 times the 2016 earnings against Asia Pacific’s regional average of 13.4 times while offering a 5.0pc dividend yield against 2.5pc offered by the rest of region.

Published in Dawn, July 31st, 2016