KARACHI: Trading began in the stock market on a negative note in the outgoing week. Uncertainty with regard to the resumption of the International Monetary Fund (IMF) loan programme coupled with mounting inflationary pressures dampened the investors’ mood, according to Arif Habib Ltd.
However, positive sentiments overcame uncertainty later in the week with the government agreeing to pay Rs190 billion to independent power producers and leaving the petroleum prices unchanged for the next fortnight.
But investors became nervous once again when the State Bank of Pakistan (SBP) called an early meeting of monetary policy committee with analysts expecting a steep interest rate hike.
The committee announced a hike of 150 basis points in the policy rate following the release of data of the current account deficit, which rose to $5.1 billion in the first four months of 2021-22 versus a surplus of $1.3bn a year ago.
Therefore, the KSE-100 index closed at 46,489 points after gaining 740 points or 1.6 per cent on a week-on-week basis.
Sector-wise, positive contributions came from commercial banking, which added 403 points, followed by fertiliser (172 points), cement (158 points), exploration and production (140 points) and power (43 points).
Sectors that contributed negatively to the benchmark were technology (176 points) and fast-moving consumer goods (41 points).
Scrip-wise, positive contributors included Meezan Bank Ltd, which added 96 points, followed by Lucky Cement Ltd (76 points), United Bank Ltd (73 points), Pakistan Petroleum Ltd (72 points) and MCB Bank Ltd (71 points).
Meanwhile, negative contributors included TRG Pakistan, which went down 233 points after its CEO was accused of sexual assault by a former employee. Other negative contributors included Unity Foods Ltd and Pakistan Stock Exchange Ltd, which took away 32 points and 16 points, respectively.
Arif Habib Ltd said foreign selling continued throughout the week and amounted to $25 million versus a net sell of $5.3m in the preceding week.
Major selling took place in commercial banking ($14.7m) and fertiliser ($4.7m).
Locally, insurance companies reported buying of $13.5m while companies purchased shares worth $7.7m. The average volume clocked in at 245m shares, down 23pc from a week ago. The average value traded settled at $53m, down 17pc on a weekly basis.
According to AKD Securities, investors’ sentiments are linked to the announcement of the IMF package. “Once through, the market is likely to post a rebound,” it added.
Published in Dawn, November 21st, 2021