KARACHI: The stock market inched up a little in the outgoing week as the passage of the mini-budget ended uncertainty about the future of reforms and dollar inflows.

According to Arif Habib Ltd, the initial positive momentum turned negative on the back of a delay in the review of the International Monetary Fund (IMF) programme. In addition, a sudden spike in the number of Covid-19 cases raised the investors’ concerns about the potential imposition of restrictions and smart lockdowns. However, the sentiment once again turned positive when parliament approved the Finance Supplementary Bill or mini-budget despite strong protest by the opposition.

Moreover, the latest data on the automobile industry for December depicted an annual increase of 96 per cent and monthly growth of 46pc. Similarly, a hike in Arab Light prices to $86.16 per barrel generated activity in the exploration and production sector. In addition, the rupee appreciated to 176.07 against the dollar.

As a result, the stock market closed at 45,763 points after gaining 418 points from a week ago. This translates into an increase of 0.9pc.

Sector-wise, positive contributions came from commercial banking (328 points), miscellaneous (54 points), chemical (50 points), power generation and distribution (47 points) and oil and gas exploration (37 points).

Sectors that contributed negatively to the benchmark were cement (67 points), technology and communication (64 points) and fertiliser (26 points).

Scrip-wise, positive contributors were Habib Bank Ltd (87 points), MCB Bank (73 points), Pakistan Services Ltd (57 points), The Hub Power Company Ltd (43 points) and Colgate-Palmolive Pakistan Ltd (39 points). Negative contributions to the index came from Systems Ltd (53 points), Lucky Cement (38 points) and Engro Corporation (33 points).

Foreign investors remained net buyers in the outgoing week, with net purchases clocking in at $0.53 million versus a net buy of $24.2m in the preceding week.

Major buying was witnessed in technology ($0.5m) and power ($0.4m) sectors. On the local front, selling was reported by mutual funds ($9.9m) and companies ($2.4m). The daily average volume clocked in at 356m shares, up 12pc week-on-week, while the average value traded settled at $51m, down 12pc from a week ago.

According to AKD Securities, the monetary policy statement on Jan 24 will determine the market direction along with the progress on the IMF programme. “We continue to advocate for gradual accumulation on any weakness,” it said, adding that its preferred sectors include banking, cement, fertiliser, consumer and a select number of stocks within the technology segment.

Published in Dawn, January 16th, 2022

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