KARACHI: Bears dominated the stock market in the outgoing week as the KSE-100 index tumbled by 1,221 points, or 2.7 per cent, to close at 44,301.

The market has been unable to gain a firm foothold after it slipped from the rec­ent high of 47,000 points. In the outgoing week, the market was held hostage to the flare-up in Covid-19 infection cases that forced the Punjab government to imp­ose lockdowns in some big cities.

As the overall infection remained above 10pc, investors were worried over exte­n­s­ion in lockdowns in other cities including Karachi. They were spooked by a repeat of the Feb 2020 slowdown in production and sales and supplies which would all go down to hurt the corporate bottom-lines in the quarterly results going forward.

On the economic side, the investors also ignored the lower than expected CPI of 9.1pc against consensus expe­c­t­ation of 9.6pc; heavy appreciation of the rupee against the dollar and the record high built-up in foreign exchange reserves. The outgoing week also saw successful issuance of the dollar-denominated Eurobonds in international markets that raised $2.5bn.

Going forward, veterans and experts predicted a ran­ge-bound or slightly positive market behaviour. The rupee on the upside, foreign excha­nge reserves piling up and receipt of more than $800m inflows under the Roshan Digital Accounts were all positive for the market.

Yet everything hinges on the course that the Covid-19 takes. However, optimists said that the upcoming results season with the roll out of financial figures from next week could support the market.

Published in Dawn, April 4th, 2021