KARACHI: The outgoing week remained bullish for the stock market which saw the KSE-100 index accumulating gains of 1,102 points (2.7 per cent) and settle at 41,266 after knocking down the 41,000-point barrier.

During the week the market witnessed four bullish and single bearish trading session.

The positive developments that elated investor sentiments and attracting them to the market included better-than-expected results from the banks, cement and fertiliser companies. Further, the rupee appreciated against the dollar to a five-month high. But there was no dearth of ongoing events that kept the investors on their toes.

The global equities markets and international oil prices remained volatile throughout the week, making it difficult for investors to take positions in the index heavyweight energy sector.

On the local front, stockholders continued to be spooked by the deepening crisis on the political front where the Pakistan Democratic Movement (PDM) prepares to hold a public gathering in Quetta on Sunday after two earlier in Gujranwala and Karachi where fiery speeches fuelled fears of more complexities on the political front.

The long wait for the FATF plenary decision on Pakistan’s position kept the investors on the tenterhook.

On the economic front, the current account posted surplus for the third consecutive month in September. The foreign direct investment and large-scale manufacturing numbers came in lower year-on-year.

Foreign investors sold shares worth $6.9m during the outgoing week, the sell-off mainly by foreign corporates. Among local participants, mutual funds and companies were net buyers of $8.59m and $4.39m while individuals and banks sold shares valued at $7.76m and $4.24m respectively. Brokers were net buyers of stocks amounting to $2.45m.

Average daily volume stood at 466m shares (up by 57pc week-on-week) while average value traded amounted to $98m (up by 59pc). Arif Habib Ltd reported that the sector-wise positive contributions came from commercial banks (240 points), fertiliser (230 points), cement (226 points), automobile assemblers (73 points) and technology and communication (64 points).

Scrip-wise positive contributions were led by Engro (136 points), BAHL (133 points), EFERT (61 points), Lucky Cement (60 points) and MEBL (57 points). Other leading gainers were Unity Foods; Cherat Cement and Attock Refinery.

The week ahead could be exciting with investors likely to be driven by various factors. The FATF decision announced in the evening on Friday would be discussed. Though a non-event as Pakistan was expected to be retained in the grey list, it was encouraging to note that the FATF plenary meeting acknowledged the country’s efforts to curb money laundering.

Pakistan has been asked to complete six action items by Feb 21, which raises hopes of return to the white list in about four months. Other positives for the market ahead are the major appreciation of the rupee against the dollar and the continuation of corporates posting stronger quarterly results.

Some big ticket companies PSO, PAEL, NBP, FFBL and MCB would unveil figures in the upcoming week. On the flip side factors that can drag down the market include the louder noises on the political front and the increasing new cases of Covid-19 that is feared to lead to more lockdowns. Finally, investors are unlikely to take fresh positions in the rollover week.

Published in Dawn, October 25th, 2020