KARACHI: The bears managed to drive out the bulls in the last two sessions of the outgoing week, wiping out the gains of the relief rally seen in the first three days. The KSE-100 index closed the week with net loss of 312 points (0.65 per cent) at 47,577 points.

Investors were spooked by the uncertainty regarding the Panamagate case verdict, the tensions on the borders, incessant foreign selling and generally lack of triggers.

Despite a dismal close, the PSX saw average daily volumes for the outgoing week surge by 9.7pc week-over-week (WoW) to settle at 171 million shares, albeit below the year’s average-to-date of 323m shares.

Average traded value rose 8.9pc WoW to $87m. “In hindsight, the relief rally seen during the first half showed signs of dead-cat-bound”, said dealers at Topline Securities.

Top drags on the index were Hub Power Company down 2.9pc over the earlier week, Engro Corp 3.1pc, Mari Petroleum 7.5pc, Fauji Fertilizer Co 2.7pc and OGDC 1.7pc with negative contribution of 233 points, while lead gainers were Pakistan Petroleum 1.9pc, Pakistan Oilfields 3.1pc, Pak Suzuki Motor Company 10.3pc, Searle 3pc and Hascol 7.3pc, making aggregate positive contribution of 135 points.

Investors ignored the threats of Chief Minister Sind and helped SSGC rally 7pc, as investors were perhaps thrilled with lifting of moratorium on gas connections & RLNG pipeline project.

Stocks leading the bourse during the week, according to AKD Securities, included: PSMC up 10.25pc, HASCOL 7.30pc, SSGC 6.51pc, PIOC 3.41pc and POL 3.06pc, while laggards were: Fatima Fertilisers down 10.62pc, EFOODS 6.72pc, NML 5.81pc, MTL 4.46pc and ENGRO 3.10pc.

According to Arif Habib Ltd sectors that outperformed in the week included Oil Marketing Companies (OMCs) up 36.30pc, pharmaceuticals 36.27pc, engineering 11.26pc and cable and electrical goods 6.92pc.

Declines were in fertilizers 144.29pc, power 76.89pc, commercial banks 40.08pc and textile 37.87 points. A market watcher stated that fertilizer sector underperformed as Fauji Fertilizer and Engro Corp witnessed selling pressure.

Exploration & production declined 1pc as oil prices remained volatile, US production pumped-up to the highest level in a year to capitalize on the higher price range.

On the flip side, pharmaceuticals increased 1.6pc, engineering 1pc and OMC’s 0.8pc gained, while banks settled the week on a flattish note at 0.3pc.

Dealers on the sales desk at Intermarket Securities calculated that the contribution to down side during the week came mainly from Engro Corp, Mari and Hub Power Co. “From the sector perspective, declines were in energy 1.28pc, consumer staples 1.03pc and consumer discretionary 1.43pc contributed towards a weak close”, the brokerage stated.

BMA Capital Market weekly report noted pharmaceuticals and biotech, multi-utilities and personal goods (Textiles) sectors as top gainers of the week rising 1.6pc, 1.3pc and 0.7pc, respectively. Conversely, food producers declined1.4pc, oil and gas 0.8pc, construction and materials sectors 0.4pc.

Foreigners were net sellers of $2.8m worth of stock during the week as against buying of $9.3m the earlier week, with most of the selling concentrated in fertilizer $1.4m and textile $1.3m, while OMC’s $2.2m saw some buying. Among local participants, mutual funds remained the largest accumulators of $5.12m worth shares, followed by brokers buying $5.03m and corporates with net purchases of $4.32m. Biggest sellers were individuals of shares valued at $5.88m and banks $4.14m.

OUTLOOK: Trading in the upcoming week is expected to remain range-bound. Among the limited short-term triggers, the foremost is the start of the results season. Foreign participation to remain subdued due to Easter holidays.

Most pundits believe that the developments on the Panam­agate case verdict would dictate market trajectory while announcements of budget proposals could induce activity.

Moving forward many stock strategists put their faith in foreign investment inflows near the MSCI EM official reclassification review in May and consistent pace of CPEC projects.

Published in Dawn, April 16th, 2017