KARACHI: The stock market remained range-bound in the outgoing week on the back of weak economic indicators and political uncertainty, according to Arif Habib Ltd.

Foreign exchange reserves of the State Bank of Pakistan (SBP) declined to $8.62 billion, putting further pressure on the rupee, which continued to weaken against the greenback. The local currency settled at 236.84 against the dollar, down 3.8 per cent on a week-on-week basis.

Moreover, there was an 8pc growth in remittances, which increased to $2.7bn from $2.5bn in the preceding month. Furthermore, the Financial Action Task Force (FATF) concluded its onsite visit to Pakistan last week.

Overall, the stock market remained lacklustre. The benchmark index closed at 41,679 points after losing 269 points or 0.64pc from a week ago.

Sector-wise, negative contributions came from commercial banking (172 points), fertiliser (89 points), cement (76 points), oil and gas exploration (75 points) and food and personal care products (43 points).

Whereas, sectors that contributed positively were technology and communication (231 points), power generation and distribution (55 points) and automobile assembling (29 points).

Scrip-wise, negative contributors were Habib Bank Ltd (81 points), Fauji Fertiliser Company Ltd (54 points), Meezan Bank Ltd (35 points), Pakistan Petroleum Ltd (28 points) and Habib Metro Bank Ltd (24 points).

Meanwhile, positive contributions came from TRG Pakistan (248 points), the Hub Power Company Ltd (51 points), United Bank Ltd (25 points), Millat Tractors Ltd (24 points) and Colgate-Palmolive Pakistan Ltd (18 points).

Foreign buying was witnessed in the outgoing week. It clocked in at $13.8 million versus a net sale of $2.82m a week ago. Major buying was witnessed in technology ($11m) and “other” sectors ($3.1m). On the local front, selling was reported by insurance companies ($8.5m) and mutual funds ($3.6m).

The average daily volume clocked in at 183m shares, up 32pc from the preceding week. The average daily value traded settled at $30m, up 46pc on a weekly basis.

AKD Securities said the stock market is expected to remain jittery going forward as the local currency is unable to find a solid ground against the dollar. “With anticipation building in the global market of a likely raise in interest rates by the US FED by 50-100 basis points, the dollar will likely remain strong, which will add to further pressure on the rupee,” it said.

With floods wreaking havoc on the economic activity and agricultural output, the brokerage said the import bill is likely to remain bloated. This

means the current-account deficit for September may also remain on the higher side, it said.

Published in Dawn, September 18th, 2022

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