KARACHI: The outgoing week started on the stock exchange on a positive note as investors anticipated that the policy rate would remain unchanged at 15 per cent.

Arif Habib Ltd said the momentum turned negative soon after international agency Moody’s downgraded the rating of five commercial banks while maintaining a negative outlook.

Moreover, remittances witnessed a decline of 12 per cent year-on-year in September. After appreciating against the dollar for the last two weeks, the rupee broke its winning streak. The State Bank of Pakistan’s (SBP) reserves depleted by $303 million, reaching a three-year low of $7.6 billion. Furthermore, automobile sales plummeted 51pc year-on-year, hitting a 27-month low.

Meanwhile, a fall in government bond yields post-monetary policy statement announcement and the expectation of flood relief support from international financial institutions cushioned the overall dip.

The index closed at 41,949 points, shedding 137 points or 0.3pc on a week-on-week basis.

Sector-wise, negative contributions came from technology and communication (117 points), commercial banking (48 points), tobacco (32 points), cement (15 points) and engineering (12 points).

Whereas, sectors that contributed positively were exploration and production (46 points) and refinery (22 points).

Scrip-wise, negative contributors were TRG Pakistan Ltd (207 points), Pakistan Tobacco Company Ltd (32 points), Meezan Bank Ltd (24 points), Engro Fertilisers Ltd (19 points) and Engro Corporation (18 points).

Meanwhile, positive contributions came from Systems Ltd (83 points), Pakistan Oilfields Ltd (20 points), Lotte Chemical Pakistan Ltd (17 points), Oil and Gas Development Company Ltd (16 points) and Nestle Pakistan Ltd (15 points).

Foreign buying took place in the outgoing week and clocked in at $12.3m versus a net purchase of $4.7m in the preceding week. Major buying was witnessed in technology ($12.4m), power ($0.8m) and cement ($0.3m). On the local front, selling was reported by broker proprietary trading ($4.8m) and companies ($4m).

The average daily volume clocked in at 267m shares, down 39pc week-on-week. The average daily value traded settled at $44m, down 7pc from a week ago.

According to AKD Securities, the Financial Action Task Force is likely to announce its final decision regarding Pakistan in the coming week and its outcome is likely to dictate short-term sentiments.

“We advise investors to remain cautious as the near-term outlook remains hazy,” it said.

Published in Dawn, October 16th, 2022